Student loans can be a huge burden, especially when your income drops. We have a student loan that we’re working to pay off early. Last year I went ahead and consolidated the loans to get a lower interest rate.
Since some readers may be carrying a student loan and are looking for ways to get their payments more manageable, I wanted to share 3 options you can take advantage of depending on your situation.
Consolidate Your Student Loans
Consolidating your loans can be a great option for two reasons:
- Lower payments: If you have lower payment obligation, you can continue making the same payments before the consolidation and pay the loan quicker. No increase in your expenses, but you’re reducing your debt quicker. That’s a win-win.
- Lower interest rate: Even if you can’t make extra payments, you pay less interest over the life of the loan.
If you’re interested in consolidating your federal student loans, there are 3 ways to do it:
- Online: You quickly and easily file and submit your application online with Direct Loan Servicing.
- Phone: You can call Direct Loan Servicing and have a customer service representative walk you through the process at 1-800-557-7392.
- Paper: My least favorite option, but if you want to do it, you can.
Not Everyone Can Consolidate
For example, you can not consolidate federal loans with private student loans. If you have private student loans, you should check with your particular lender to see if there is a minimum required to consolidate them.
What if you are on a somewhat limited budget, could you make your student loan payments a bit more manageable? Yes you can if you apply to be considered for receiving income based payments. As the name implies, you can
If you want to get an idea about what your student loan payment would be under IBR, here’s a wonderful calculator.
Apply for a Deferment
What if you just can’t make payments right? Perhaps you lost your job and your unemployment check barely covers your essential bills. Can you get some help?
The good news is that you can pause your student loan payments by getting a deferment. It will postpone your payments for a specific time period (interest on your student loan. You have to qualify to get it, but if you have the circumstances this is a good option until you can get your head above the water.
Thoughts on Student Loans
How about you? Do you have difficulty making your student loan payments? I’d love to hear from those who have succeeded in any of the above options. How have you worked through it?
Photo Credit: jennifercw