Graduating college is an exciting experience. It's the start of the rest of your life. You get to walk away from classrooms and exams and hang a diploma on your wall.
Oh yeah, there's also the whole part about repaying your student loans.
This was the part you pretended you could avoid, but now that it's here, what do you need to know?:
Your Grace Period
"The grace period on a private loan is typically 6 months from the time of graduation," Sue Khim, the founder of Alltution.com says. "You won't have to make any payments, but interest will still accrue. The grace period is a great time to formulate a plan of action."
Federal student loans carry a six month grace period as well. You'll probably start getting mail or calls from your lender as the grace period ends.
Be aware of how long you will have to make repayments. For example, Discover student loans have a repayment period of up to 15 years for regular degrees, but a 20 year repayment for advanced degrees. Check on the websites of your lenders, whether it's Discover, Wells Fargo or another bank, or the federal government, to see if they have any tools to help calculate what you'll be paying.
"The grace period also is a good time to establish a monthly budget that includes a student loan payment," says Steve Olszewski, SVP of
Discover Student Loans. "For example, during the grace period, a borrower might set aside each month the money they would normally use for a payment, which would give them a feel for what's left to pay remaining monthly expenses and leave them some cushion money."
See Also: Predatory For-Profit Colleges Pay Executives Based On Corporate Profitability, Not Student Outcomes
Deferment & Forbearance
Your loans were likely already in deferment while you were in college if you were a full-time student. Most loans include a 6 month grace period after that.
But you can apply for an extended deferment.
"If you're unemployed or struggling financially, a deferment or forbearance will put your payments on hold for a short time," Khim explains. "The big difference here is that interest won't accrue on your subsidized [federal] loans during deferment, but it will build up during forbearance."
You can set up a deferment or forbearance any time, even near the end of your grace period.
"Common reasons for deferments include active military duty, public
service and health care residency," says Steve Olszewski, SVP of Discover Student Loans.
A representative from Wells Fargo says that if a borrower is struggling to make payments, and allows the loan to go into a delinquent status, lenders might have fewer options available.
Federal and private loans will continue to accrue interest during a forbearance or deferment period.
Khim also adds that you should never miss a payment, and if you think you might, contact your lender immediately. "You'll want to avoid missing a payment like the plague--nothing good can come of it," she says.
Consolidation
Consolidating your loans means you would apply for a new loan that would cover what you currently owe. You would then start paying the new loan.
"When students consolidate their student loans, they generally are combining multiple loans into a single loan with one monthly payment. In some cases, banks will extend the new loan repayment period with lower monthly payments," Olszewski says. "However, a longer repayment period increases the amount students pay over the life of the loan because more interest will accrue during the extended time frame."
You don't have to go through the same bank you got your private loans through, either. If you have loans from, say, Wells Fargo, you can go to a another local or national bank for a consolidation loan. However, Wells Fargo also has their own consolidation loan to offer.
"Consolidation does lower your monthly payments, but it also means you'll be paying for a longer time and paying more overall," Kihm says.
One thing to know -- private and public loans cannot be combined here. If you have private loans from more than one bank, you can consolidate them together. However, the public loans you got from the government do not work for consolidation.
If you do decide to consolidate multiple federal student loans, into one monthly payment to a single servicer, Olszewski notes "the interest rates for consolidated federal loans are fixed and cannot exceed 8.25 percent."
If you're not sure you want to do consolidation, check about other
options that may be available.
Extended repayment is one option Wells Fargo offers to "certain borrowers and payments may be based on a fixed or graduated repayment schedule over a period of up to 25 years." A number of lenders also have graduated repayment, where you make lower payments at first, then gradually increase them.
If you don't want to consolidate, check to see if your servicer can at least adjust the schedule so you have payments to each lender due at the same time each month.
How Do I Escape Debt?
It's not easy.
Student loans from the federal government cannot be erased in bankruptcy, and thanks to a 2005 change in the law, private student loans are not eligible for bankruptcy either.
In a statement, Wells Fargo said in the event of permanent death or disability of the student, they offer loan forgiveness for any private student loans used to directly cover education-related expenses.
Truth from someone who knows first hand of what it's like:
- Your First payments are often due just one or two months after you have finished you 'Schooling' or Education.
- Even if you get a Forbearance or Deferment, you are still called everyday by someone who knows you have no means of making any kind of payment.
- Your information is given to collection agencies and someone from Sallie Mae will call you at the same Time.
- With them checking up on you to see if you are working can sometimes keep you from landing a decent job cause the employers will notice this in their background checks.
- Lets not forget that you will receive calls from someone who is a supervisor from Sallie Mae, but who is just an regular collection employee. (It's all scare tactics used in just about any collection agency office in the US. Meaning they will lie and even threaten people to get any payment. True it has happened to me!)
- Most Schools that offer job placement don't really care if you land a job that will help you pay for the large debt you just made for yourself. As long as all the forms are signed, they get paid anyways and you get Fucked if you can't find work.
-I was told and once saw this as "Good Debt," but now it's the worse thing a person can be stuck with today in an American that is really turned out to be a "Every Man For Himself State."
-If you are lucky to get into a job, it's usually runs on the machine of not how you do your job, but if people there like you. Meaning, you can be fired for just about anything someone says about you.
(Code For Racism) or At Will State!
Note: Like most men I had a choice to be a crook or try to educate myself, I chose to educate myself. It was not at an big school, At least not at first. However I tried that later. And just for following the rules and trying to live up to a standard that does not exist anymore in Society, I have still become the criminal or crook by trying to do the right things.
Oh yeah, there's also the whole part about repaying your student loans.
This was the part you pretended you could avoid, but now that it's here, what do you need to know?:
Your Grace Period
"The grace period on a private loan is typically 6 months from the time of graduation," Sue Khim, the founder of Alltution.com says. "You won't have to make any payments, but interest will still accrue. The grace period is a great time to formulate a plan of action."
Federal student loans carry a six month grace period as well. You'll probably start getting mail or calls from your lender as the grace period ends.
Be aware of how long you will have to make repayments. For example, Discover student loans have a repayment period of up to 15 years for regular degrees, but a 20 year repayment for advanced degrees. Check on the websites of your lenders, whether it's Discover, Wells Fargo or another bank, or the federal government, to see if they have any tools to help calculate what you'll be paying.
"The grace period also is a good time to establish a monthly budget that includes a student loan payment," says Steve Olszewski, SVP of
Discover Student Loans. "For example, during the grace period, a borrower might set aside each month the money they would normally use for a payment, which would give them a feel for what's left to pay remaining monthly expenses and leave them some cushion money."
See Also: Predatory For-Profit Colleges Pay Executives Based On Corporate Profitability, Not Student Outcomes
Your loans were likely already in deferment while you were in college if you were a full-time student. Most loans include a 6 month grace period after that.
But you can apply for an extended deferment.
"If you're unemployed or struggling financially, a deferment or forbearance will put your payments on hold for a short time," Khim explains. "The big difference here is that interest won't accrue on your subsidized [federal] loans during deferment, but it will build up during forbearance."
You can set up a deferment or forbearance any time, even near the end of your grace period.
"Common reasons for deferments include active military duty, public
service and health care residency," says Steve Olszewski, SVP of Discover Student Loans.
A representative from Wells Fargo says that if a borrower is struggling to make payments, and allows the loan to go into a delinquent status, lenders might have fewer options available.
Federal and private loans will continue to accrue interest during a forbearance or deferment period.
Khim also adds that you should never miss a payment, and if you think you might, contact your lender immediately. "You'll want to avoid missing a payment like the plague--nothing good can come of it," she says.
Consolidating your loans means you would apply for a new loan that would cover what you currently owe. You would then start paying the new loan.
"When students consolidate their student loans, they generally are combining multiple loans into a single loan with one monthly payment. In some cases, banks will extend the new loan repayment period with lower monthly payments," Olszewski says. "However, a longer repayment period increases the amount students pay over the life of the loan because more interest will accrue during the extended time frame."
You don't have to go through the same bank you got your private loans through, either. If you have loans from, say, Wells Fargo, you can go to a another local or national bank for a consolidation loan. However, Wells Fargo also has their own consolidation loan to offer.
"Consolidation does lower your monthly payments, but it also means you'll be paying for a longer time and paying more overall," Kihm says.
One thing to know -- private and public loans cannot be combined here. If you have private loans from more than one bank, you can consolidate them together. However, the public loans you got from the government do not work for consolidation.
If you do decide to consolidate multiple federal student loans, into one monthly payment to a single servicer, Olszewski notes "the interest rates for consolidated federal loans are fixed and cannot exceed 8.25 percent."
If you're not sure you want to do consolidation, check about other
options that may be available.
Extended repayment is one option Wells Fargo offers to "certain borrowers and payments may be based on a fixed or graduated repayment schedule over a period of up to 25 years." A number of lenders also have graduated repayment, where you make lower payments at first, then gradually increase them.
If you don't want to consolidate, check to see if your servicer can at least adjust the schedule so you have payments to each lender due at the same time each month.
It's not easy.
Student loans from the federal government cannot be erased in bankruptcy, and thanks to a 2005 change in the law, private student loans are not eligible for bankruptcy either.
In a statement, Wells Fargo said in the event of permanent death or disability of the student, they offer loan forgiveness for any private student loans used to directly cover education-related expenses.
Truth from someone who knows first hand of what it's like:
- Your First payments are often due just one or two months after you have finished you 'Schooling' or Education.
- Even if you get a Forbearance or Deferment, you are still called everyday by someone who knows you have no means of making any kind of payment.
- Your information is given to collection agencies and someone from Sallie Mae will call you at the same Time.
- With them checking up on you to see if you are working can sometimes keep you from landing a decent job cause the employers will notice this in their background checks.
- Lets not forget that you will receive calls from someone who is a supervisor from Sallie Mae, but who is just an regular collection employee. (It's all scare tactics used in just about any collection agency office in the US. Meaning they will lie and even threaten people to get any payment. True it has happened to me!)
- Most Schools that offer job placement don't really care if you land a job that will help you pay for the large debt you just made for yourself. As long as all the forms are signed, they get paid anyways and you get Fucked if you can't find work.
-I was told and once saw this as "Good Debt," but now it's the worse thing a person can be stuck with today in an American that is really turned out to be a "Every Man For Himself State."
-If you are lucky to get into a job, it's usually runs on the machine of not how you do your job, but if people there like you. Meaning, you can be fired for just about anything someone says about you.
(Code For Racism) or At Will State!
Note: Like most men I had a choice to be a crook or try to educate myself, I chose to educate myself. It was not at an big school, At least not at first. However I tried that later. And just for following the rules and trying to live up to a standard that does not exist anymore in Society, I have still become the criminal or crook by trying to do the right things.
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