Student loans taken during the course of studies provide great support in the completion of the studies. However, it is most often observed that the students are required to take more than one loan to complete their studies. Most of the students try for the Federal loans, even succeed in getting them, but looking at the increasing cost of the studies they have to take loans from the other private financial institutions as well. With so many loans the repayments often becomes a problem even if one gets a job after the completion of their graduation.
What are the loan provisions under the standard plan?
Standard plans are the most popular loan plans available. One gets registered under the plan as soon as they opt for them. The repayment plans range for a period of ten years. Students are required to pay in monthly installments which are often flexible and are subject to change if the student faces hardships in payments. Ten year repayment schedule can be tough if the loan amount is higher. Furthermore if the student fails to get a high paying job, which is most difficult in the current circumstances and the economic scenario; one can go in for the re-adjustment of the loan term which is possible by the proper representation of the hardships faced by the students.
What is meant by the Graduated loan plan?
The repayment option offered here is that one begins with a lower repayment but increases as one graduates with a better salary. These repayment options are of great help to the students in the current economic scenario. Getting jobs is becoming more and more difficult nowadays. Moreover, even if one gets a job, the salaries are not that great as fresher’s in the industry. However, as one gains experience and expertise they are eligible for higher salaries and hence have a larger disposable income which can be used to increase the monthly repayments on the loans.
What is the meaning of extended reimbursement?
Sometimes student loans extend beyond the limits which are difficult to repay. An amount of loan ranging between $35000 to $50000 could have led to surprises in the past few years but in the current scenario they are very common looking at the huge expenses involved in the education. Looking at the loan amount, the repayment installments in the short run could be huge and often impossible for the student to pay. Thus the loan term is extended to a maximum of 30 years so as to keep the monthly installments lower. These might be a great help in repayments but often draws huge amounts as interest payments which one should take care of.
Is consolidation a good solution?
Consolidation of loans offers a great means to club all the smaller loans and replacing them with a bigger loan. This offers people the flexibility to repay a single loan with a minimum interest.
Are the automatic transfers helpful?
With the online banking things are changing rapidly. One can easily set up the payment dates with the banks and get them EMIs paid automatically. This saves them from forgetting the repayment dates and also no delays in the repayments.
What should we do if in case we are unable to repay the loans by any of the modes?
One should seriously look out for the forbearance. This allows the loan repayments to be restricted for a period ranging between 1 to 5 years. The interest rates are payable during the period and in case the borrower is unable to repay the same too, the interest rates are added on to the principal over due and is calculated and taken from the borrower once they complete the forbearance period.