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Looking For The Best Student Loan Partner

Woman having telephone conversationLooking for a student loan partner to help you with your repayments is tough job. There are a lot of student loan companies that can help you manage your payment. Most of them are qualified to help you assess and execute your student loan repayment. So it makes sense to get a student loan partner to help you in your repayments.

But the biggest challenge is looking for the best student loan partner that will be able to help you achieve your goals. The danger of partnering up with a scam artist can leave you high and dry and deeper in debt than when you originally started. Unfortunately, there are some student loan borrowers who has already fallen into this trap.

One of the ways scam artists lure in student loan borrowers is preying on their desperation to get out of their student loan predicament.With the promise of low monthly repayment amounts and an assurance of getting out of the debt fast, these borrowers take up scam companies as their student loan partner.

Because of this, a lot of borrowers are taking a step back because they are afraid to fall into a debt trap. As a result, some of them are making mistakes in their repayment and end up paying for it financially. This is one of the facets of having a student loan partner, they are able to dispense important pieces of advice when tackling student loan repayment.

Choosing the best student loan partner

There is wisdom in getting a company to help you manage your student loan repayment. This is because they can thoroughly look into your student loan accounts and lay out possible repayment options especially how loan consolidation can help you with your payments. Here are some of the things you might want to look into when choosing a student loan partner.

  • Transparency with the fees. This is usually where scam companies are able to victimize some borrowers. Some of them requires clients to make upfront payments even before any actual work has been done. This practice is actually against the law and one clear cut way to spot a scam company. Be mindful because some companies put fancy terminologies when referring to upfront fees. As long as you are being asked to pay something prior to actual work, that is an upfront fee. There are also some companies who are earning by adding a percentage for every payment. This might leave you with a higher payment down the line. What you want to look for is a company that computes their fees according to their performance. If they were able to help you with your goal, they collect their fees. That is how it should be done.
  • Background of customers.When looking for a student loan partner and someone who can help you consolidate your student loan accounts, you need to look for a company that has a track record of delivering on their promises. Look at how they were able to service previous and even existing customers to gauge how their service delivery versus their promises to help in consolidating student loans. You can easily research what people are saying about the company to see if they are worth taking up as a student loan partner.
  • Track record with industry affiliations. When looking at student loan consolidation reviews, one of the important things to look for is being affiliated with industry associations. For one, this helps you ensure that you are talking to legitimate companies. They need to be registered entities to become members which is one of the reasons why Sallie Mae lost a case versus a borrower because some of the company name suing was not registered according to TheGuardian.com. This lets you know that the company tries to make an effort to make sure their name is clean.

Looking at your repayment habits

Sometimes even with student loan partners, the borrowers themselves are to blame for their student loan repayment struggles. The repayment is challenging but it should not be the end of the world for the borrower. Here are some of the habits that you might not notice you are committing.

  • Limiting yourself on ramen to save on food. It is a good idea to be frugal about your living expenses. But this does not mean dumpster diving or eating ramen for the rest of your life until you pay off your debt. More than being unnecessary, you might end up with a bigger debt with health bills. Student loans does mean you need to make some sacrifices like passing up on a dinner with a group of friends because a restaurant opened up in town. It could also be going straight home instead of having a few rounds of beer after work. But it does not require you to fast on noodles just to save money for payment.
  • Overlooking other funds to pay student loans. Once you graduate and start living life on your own, you will also have to deal financial planning not just for your daily needs but for a financially better-off future. For one, this means that you would need to make sure that you have enough emergency fund to sustain you when you encounter financial hardship. This could mean minimum payments on student loans to be able to build your emergency fund. Taking advantage as well of a company matching for your 401(k) can mean your extra funds can be more hardworking when used to build up your retirement fund.
  • Forcing a repayment plan you cannot sustain. For federal student loans, even your student loan partner would recommend the Standard Repayment plan. This is because it offers the shortest repayment time frame and will save you the most when looking at interest paid over the life of the loan. This is true but you have to remember that this is looking at and comparing only the repayment plans. These plans are only as effective as your capacity to pay. You cannot force a high monthly payment when your budget cannot afford it. There are plenty of repayment plans for federal student loans to choose from that can match your payment capability. Private student loan lenders are also starting to look at payment modification for their borrower as reported by Forbes.com.
  • Not paying your loans at all. This is the worst thing that you can do when you have a student loan debt. Choosing to ignore the situation will not be recommended by anyone even your student loan partner. Delinquency and default brings so much devastation to your credit score and bankruptcy is almost always never an available option. The US Department of Education also has wide-reaching collection powers that can include wage garnishment for borrowers who has defaulted on their student loans but currently holds a steady job. The government can also intercept tax refunds and even lottery winnings.

Missteps in college

People all make mistakes but the important thing is to pick up the pieces and learn from them. But there are also those that choose to try and use student loans for other means. Credit.com reported how  Mindy Ritch of Texas was arrested for taking out more than $500,000 in fraudulent student loans under her name.

There  are a lot of decisions that can put you under a lot of student loan debt that student loan partners can point out to help you in managing loans. Borrowing more than what you need is one where you take out more than what you need and you use the refund check for other activities like a vacation or buying expensive non-school related gadgets. It is important to understand how repayment will affect you in the future.

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Student Loan Servicers In Hot Water

Woman looking worried in front of a laptopAs synonymous is college education to student loans, student loan repayment seems to have the same effect with student loan servicers. It is almost impossible to think of one without the other. Most people would now associate higher education with the need to take out a student loan. This is because not all American families are able to put up and build a college fund that can cover the whole ride.

Then when repayment is due after separating from school, it is hard not to think of student loan servicers as well. This is especially true for the almost 40 million consumers who are at least trying to balance one outstanding student loan according to Mainstreet.com. And with this number, the federal government is unable to carry the communication with the borrowers thus the need to outsource it to loan servicers.

With the $1.3 trillion student loan debt in the country, majority of this are federal student loans and a small amount are private student loans. It is no secret that federal student loans has more benefits and advantages over private student loans but when it comes to repayment, the loan servicers are taking some heat in how they deal with student loan borrowers.

Federal student loans have lower interest rates than private student loans and also has more repayment plans to choose from when the bill comes due. Federal student loans are also need based while approval and the interest rate to be used are all based on the capacity of the borrower to repay which is quantified by their respective credit scores. The higher the score, the bigger the probability of approval and getting low interest rates.

But the student loan servicers are getting a lot of attention right now in a not so good way. As the federal government loans money to students through the US Department of Education or ED, the actual servicing of these loans are outsourced to student loan servicers. These includes collection of payments and making sure that the borrower is able to understand his or her options in meeting their financial obligations on their college loans.

Student loan servicers’ collection practices are questionable

According to a report by NCLC.org, they are claiming that the government’s decision to use collection agencies are short sighted. This of course refer already to the existing loan servicers and those agencies that are tasked to collect on loans that already defaulted. This shows how the borrowers are still struggling with their student loan repayment.

According to USNews.com, there are over seven million borrowers in 2013 that defaulted on either their federal loans or private student loans. This means that they were not able to make a payment on their student loans for nine months or 270 days. This means that they could either have overlooked the account or are experiencing some financial hardships.

As these borrowers struggle, they would need to coordinate with their student loan servicers for options on how to best solve their problem. But as great as this maybe, some student loan servicers’ collection practices leaves much to be desired. This recently came to light are now the topic on student loans.

  • Inappropriate collection calls. There were some student loan servicers who made calls to borrowers either too early in the day or too late in the evening. These are forms of harassment and should not be tolerated. There was even one borrower who received 48 phone calls during the time of the survey. The collection calls should be done within decent hours in the day and not when the borrower is about to sleep or just getting out of bed. Granted that borrowers need to pay their student loans but these borrowers needs to be protected from harassment on collection.
  • Late fees on underpayment. As student loan borrowers rely on loans during school, they usually end up with a lot of student loan accounts that they have to repay. Oftentimes, borrowers have more than one student loan account with their loan servicers. With this, they just sum up all the minimum payments on the accounts and send one lump sum payment to their loan servicers. But once they send below minimum payment on one account, the student loan servicers applies the payment equally across the board. This can lead to underpayment on a lot of accounts and the borrower will be charged fees. Some loan servicers do this to be able to collect fees on the account
  • Minimum payment is more than necessary. There are some student loan servicers who seems to increase the minimum payment amount by adding the interest that are accruing on accounts that are on deferment. Although it can be paid and can help the borrower lower the amount to be paid in the future, it needs to be done with the knowledge and approval of the borrower.
  • Late fees in grace period. Just like in most payments, the borrower is given a grace period to be able to send in their payments after the due date. If the due date is the first of the month and there is a 15-day grace period after that, it means that the borrower has until the 16th of the month to send in the payments. This is the same with student loans where the loan servicers usually give borrowers a grace period to send in their monthly payments. But there are some student loan servicers who are still assessing late fees for payments received inside the grace period.

The government stands to earn from student loans

The Huffingtonpost.com shared that the federal government took in about $50 billion in student loans in 2013. This is with the help of student loan servicers who are collecting in behalf of the government. These companies has a big collection arsenal on their hands being able to utilize wage garnishment, intercepting tax refunds and even taking the benefits of the retired borrowers who still has payments on their student loans.

This begs the question if the loans are really meant to help the students or is a great source of revenue for the government. If it is the latter, then why are other foreign governments such as that of Germany able to waive off and offer higher education for free to students. They are investing on the future economic movers and shakers to be able to propel their economy forward.

Making the payments as easy as possible

As you tackle repayment hopefully with the help of your student loan servicers, here are some things to look into to help make the process as easy as possible.

  • Loan consolidation. If you are looking at multiple student loan accounts, consider student loan consolidation. You can look at student loan consolidate review websites to check the company that can help you achieve your repayment goals.
  • Understand your options. Your student loan servicer can help you look at your repayment options but it is better to have knowledge about it beforehand. This way, you are just asking about the benefits and advantages of the plan and not how it works. You will also be able to make informed decisions as you go along.
  • Make extra payments  This is not mandatory but if the budget allows for a few extra dollars to be paid to student loans, it will help you save up on interest payment and pull the pay off date closer.
  • Monitor your payment posting. You do not need to monitor your accounts every single day. Doing it once a month is enough just to be sure that you payment are posting on your account and they are being applied accordingly.

Student loan servicers acts as the extension of the ED and helps collect the payment on the loans. But in some cases, some of them uses questionable collection tactics that are not beneficial for the borrowers.

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Graduate looking at a picture of a houseA lot of people would tell you that student loans affect mortgage loans. This is for the simple reason that the more a person is in debt, the lesser their chance and even their drive to take out a mortgage loan for a house. This is a very valid argument and actually has some merit in being a factor in how mortgage loans are performing with the younger set of consumers especially the ones that are saddled with student loan debt.

At present, the student loan debt has ballooned to about $1.3 trillion according to BuffaloNews.com where majority of which is still made up of federal student loans. Student loans was at an increase even during the Great Recession where all others – mortgage, credit card and auto loan were on a decline because of market uncertainty.

There are over 40 million American consumers who are dealing with at least one outstanding student loan according to CNN.com. That number of borrowers is even bigger than the population of some countries combined. And the number seems to be getting bigger and bigger as time flies by. This is alarming because as new borrowers take on student loan, some older borrowers should be paying off theirs.

But even as the default rate on student loans went down by 1%, there are still a good number of debtors who are struggling with their student loan repayment. Even with the multiple repayment plans in federal student loans, there seems to be a struggle with borrowers meeting their financial obligation with student debt.

Student loan repayment problems

There could be a number of reasons why borrowers would run into repayment problems. According to ED.gov, there are about seven repayment plans for federal student loans to choose from. This includes the default Standard Repayment plan and others where the amount to be paid every month depends on the income of the borrower. With all these options for repayment, why are borrowers having problems with them? Here are a few things to consider.

  • Unable to find a job. Having finished higher education is a great advantage in looking for jobs but it is never advertised as an assurance. Indeed there are still some graduates who are finding the job market a little tough to crack. There are grace periods for federal student loans which gives borrowers a few months to look for employment before the bills start to come in. But this is not the case for private student loans. The longer the borrower is out of work, the more student loan repayment becomes a challenge.
  • Mismanaged student loan borrowing. This is the result of poor choices made during school. Students needs to have an idea on how much their field of study can fetch them in terms of income in the future. This is then a good basis to manage the amount of student loans that they borrow. A six-digit student loan for a teacher can mean that more than what was needed was borrowed for cost of attendance.
  • Lack of budgeting skills. As you start earning and paying bills. it is sometimes just the lack of budgeting skills. It could be that you will be a bit tight with your disposable income but you need to make sure that your loans and debts are first repaid monthly. Not listing down your income and expenses every month is a sure way to blow your money into useless expenses leaving you nothing for the essentials.
  • Bad decisions. At times, there are just some borrowers who makes bad decisions that ripple out on to their financial lives especially student loan repayment. Going on a cruise after graduation instead of looking for a job first or charging multiple big ticket items on a credit card because of an assurance of income are just some of the bad decisions that can lead to difficulties in student loan repayment.

Student loans has an effect on mortgage loans

With all these borrowers struggling in meeting their student loan repayment, some are quick to point out that student loans affect mortgage loans. It is easy to see the correlation between the two but some people fail to see beyond the obvious Here are some the reasons why young consumers are preferring to rent rather than get their own place.

  • Monthly budget. This is one clear example of how student loans affect mortgage loans. Getting a house is probably one of the biggest and most expensive financial decisions a person will make in their life. As such, the monthly mortgage payment is no joke and could easily shoot up to the top spot in the budget in terms of amount. This is one of the more obvious reasons how student loans affect mortgage loans, the borrower is still making student loan repayments and the budget might not be able to accommodate payments on the two.
  • Less expensive to rent. Getting a mortgage loan requires an aspiring homeowner to have an equity on the house. This means that they should put in a downpayment on the property. This could be anywhere between 20% or up. Less than this and the lender would put in an insurance that the homeowner would have to pay which is essentially a protection on the part of the lender in case the borrower defaults on the property. There are also taxes and insurance and other miscellaneous expenses that needs to be budgeted when buying a house. Renting on the other hand takes all these away from the renter and puts it on the shoulders of the landlord. This makes renting less expensive than owning a home.
  • Amenities offered in renting a place. There are a lot of consumers who go to the gym for a regular exercise or look for a pool to do some laps.There are also some who prefer the quiet ambience of a park to read their own book or to sneak in a yoga move. Renting gives these amenities that is already within their area.They do not have to go one place for a gym and another for a pool.They do not also have to look for a park just to get some relaxation.
  • Flexibility and options. Most young consumers are still figuring out life and this means that they need freedom to make decisions and to make mistakes. Student loans affect mortgage loans but there are some borrowers who prefer renting for the flexibility it offers. Getting a call to report for work in a different state is a quick decision when they are renting versus when they are already making mortgage payments.

Meeting the monthly budget for student loan repayment

This is one  of the first challenge a student loan borrower has to consider when faced with a steady income and years of student loan repayment.  Here are a few things to look into to help make sure that the student loans are repaid on time every time.

  • Do an audit of all your student loans. This is important because you do not want to miss out and overlook any student loans you have taken out while in school. Regardless of how small they are, it can quickly snowball into a massive debt because defaulting on a student loan could add a lot of charges on the account.
  • Consolidate your student loans. This is a great program to get a handle on the administrative part of your student loan repayments. You can look into student loan consolidation reviews to help you choose out the best company to work with to help you consolidate your loans.
  • Enroll in auto debit program for your repayments. if your lender offers such a program, it is worth exploring because it will not only make your monthly repayments hassle-free, there are some lenders that offers a reduction on the interest rate if the borrower enrolls in the program, This is an incentive given by the lender because they are sure that the payments will come in every month.

It is true that to a an extent, student loans affect mortgage loans. But there are other reasons why some consumers prefer to rent instead of taking out a mortgage and it is not always about the student loans.

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 young woman looking puzzledThere are a lot of college debt holders who wants to get out of student loan repayments. This pushes a lot of borrowers to aggressively pay down student loans as fast as possible. This does not only save them interest payments in the long run but also paves the way for starting early on some life opportunities like getting a house, getting married and having children.

As borrowers tread down this aggressive approach, they sometimes overlook some important funds that puts them in a tight spot down the road. There are borrowers who wants to get out of student loan payments that they put off building their retirement fund and even their emergency fund. These are some of the most important funds that should not be passed up for student loan repayments.

As Forbes.com shares that the total student loan debt amount is already at $1.2 trillion, more and more borrowers are struggling to meet repayments and are just eager to get out of student loan repayments. Sometimes all they need is a breather from the monthly repayment to get back on track while others are in dire need of a break due to financial roadblocks.

And there is now more American consumers who are holding on to student loans. There are now about 40 million people who has at least one student loan according to Mainstreet.com. There are a lot of people who wants to get out of college debt now more than ever. And because of this, scam artists are taking advantage of desperate borrowers who wants to get out of repayment.

Options to get out of student loan debt

The number one way in eliminating student loans is to actually pay it off. But this is always easier said than done especially when the borrower experiences financial shortcomings. It could be from losing a job or transferring to a new career. It could also be that the family experiences some medical emergencies that drains the budget down.

In these situations, it is best for the borrower to understand some of their options they have in order to temporarily get out of student loan payments.

  • Deferment on student loan payments. One of the best options for borrowers who are looking for a temporary postponement on their college debt payments. As ED.gov explains, deferment allows a borrower to put a hold on the principal payment and to some extent, even on the interest payment. The break on the loan is already a big help and non-accrual on the interest payment will help manage the repayment when the borrower gets back on repayment.
  • Forbearance on the payments. One way out of student loan payments is applying for a forbearance on the debt. It is similar to deferment with one major difference, the interest payment will continue and accrue on the loan. When the borrower gets back on the repayment, they will see a bigger principal amount because the interest accrued and was added to the principal amount. This can lead to bigger monthly repayment amounts.
  • Consolidating student loans. This is one of the most used repayment program of student loan borrowers and helps make the repayment a little easier. It combines several student loan accounts and makes the borrower focus on just one student loan debt. It can certainly help the college debt holder get out of student loan repayment by making sure that they are able to make the payments on time every time.
  • Forgiveness programs. Federal student loans has quite a number of unique advantage over private loans and one of them is their forgiveness programs. Most repayment plans of federal student loans has a forgiveness time element to it where it forgives debt that already reach the maximum repayment time frame. There is also a Public Service Loan Forgiveness (PSLF) program for federal student loans. This entices graduates to enter the public sector where 120 qualified monthly payments can help forgive student loans.

Preparing for college costs

As college graduates are entering repayment after months of grace period, there are high school students and families who are looking into college in a few months. As the ChicagoTribune.com shares that the 2014 college graduates are holding on to about $33,000 average student loan debt, the class of 2015 might just be able to overtake them based on historical and present data.

One way to approach college is to understand what you are getting into. Here are a few questions that you can use to help prepare for the college and the costs that goes with it.

  • What industry do you want to belong to? Asking this leads to one of the biggest decisions you will ever make before going to college, what degree will you get? Understanding the field where you want to work can help you focus on degrees that can help you get there. Your skills, talents and even hobby can also contribute a lot in defining the field of study that you can get into for college.
  • What type of school can you afford? This is the next big question after identifying the degree. There are a lot of colleges and universities in the country and they all range from community colleges to for-profit private schools. Look at the cost of attendance of the degrees you want to take up in each school and compare the prices. It is important to remember that your projected debt amount from college should be commensurate to your expected income in your field of work.
  • Are there any income opportunities in school? Try to see if there are part time jobs that you can explore while you are in school. It is even better if you will be able to get something that directly relates to your target field of work.  You get that much needed extra funds to pay for some college expenses and you also pile up months and years of work experience that is related to a future job. This can also be a work-study program that your school can offer to offset some school expenses.
  • Are there any ore sources of free money? After you fill out the Free Application for Federal Student Aid or FAFSA and get some grants and even scholarships, do not stop there. There could be other sources of free money that you can use to pay for your college expenses. There are groups, association or even your parent’s company who might be great sources of any amount of free money for college.

Attitude towards student loan repayment

As soon as college is done and you are headed into repayment, you need to be methodical in your approach to be able to get out of student loan repayments.

  • List down all your student loans. You need to make sure that you account all your student loans because if you have been taking them out year on year until you graduate, you are bound to end up with multiple student loan accounts. The last thing you want is to overlook one debt and let it enter default.
  • Understand your repayment options. Private student loans does not have much options but federal student loans have multiple repayment plans. Apart from the Standard Repayment Plan, there are options that will take into consideration your income when computing for your monthly payment.
  • Apply for auto debit. This automates the payment process and might actually save you a little on interest because other lenders use that as an incentive to apply in the program.

Getting out of student loan repayment is a tough situation. But keeping at it will eventually free you up in your payments.

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5 Tips In Student Loan Repayment

Stressed Female Graduate in Cap and Gown Holding Stacks of Hundred Dollar Bills Student loan repayment is affecting not only the borrower but the whole US economy as well. PewSocialTrends.org recently shared that 2012 saw a record percentage of students taking out student loans just to finance their higher educaiton. Of all the graduates, 69% took out loans and are carrying college debts because of school expenses.

The 2014 graduate also holds the distinction of having the highest student loan average balance at $33,000 per borrower. The only thing that can overshadow this figure could be what the 2015 graduates are looking into. With cost of attendance becoming much more expensive and families are sending children to college without any college funds, student loan repayment will continue to be a burden.

If there is one thing going for student loan borrowers, it would be that college education is still worth it in terms of income. When compared side by side with what high school graduates and even those that had some college education, college degree holders still command a big salary in the group. They are still able to get a higher salary than the rest.

But as the education is still worth it, the student loan is another story. But in today’s time, it is quite hard to talk of one without the other. Undergraduates and even those seeking post-graduate studies are turning to student loans just to fund their dreams. Some of them even feel that they should not be put in that situation because they will eventually be contributors to the economy.

What to do in repayment of student loan

As the students take out loans, it is inevitable that they will enter repayment on their loans. Regardless of how long the grace period is or the time allotted for deferment or forbearance, the borrower would eventually have to make payments on the student loan. When that happens,it will be years of ensuring that the payment be sent on time all the time.

Marketwatch.com came out with a material saying that there is one solution to the student loan problem and that there is a way for college graduates to be able to get mortgage loans and even car loans after graduating. The most simple solution is to turn tuition fees in college free. The article said that it is possible as there are countries doing it and that it only takes the willpower.

But for those that are already in repayment, here are some tips to look into to help make the process a little more bearable.

  • Increasing lifestyle with increase in income. As you work 40 to 50 hours a week trying to prove yourself, there will come a time that you will get a raise or be even pirated by other companies offering a higher salary. Whatever your decision is, one thing is certain, you will be having a bigger pay than when you started working. You are already thinking in your head all those gadgets and equipments that you have wanted to buy for so long. But one thing you can actually do with a pay increase is to forget that you ever got one. And to up the ante, give yourself a demotion. Lower the amount that you can spend and automatically send the funds you save as extra payment for student loans.
  • Being frugal with the wrong things.  Being frugal is a great way of saving a little more extra on the side. Instead of going to the movies, you can opt to stay at home with your family and watch movies online. You can also have your kids pass down clothes to younger siblings to save cost in buying clothes. But there are things in your life that frugality can actually backfire. Putting little in retirement money or even passing up the opportunity to increase your emergency fund are some of the things that you should never practice being frugal.
  • Discounted items becomes a catch if you have a use for it. Buying in bulk is a great strategy to be able to save a few dollars on the purchase. Chancing upon that store sale in the mall is sometimes being in the right place at the right time. But before going ahead and buying the items at a discount, one thing you need to ask yourself is if you really need the items. Do you need a whole box of orange juice when you might not be able to consume all of them ahead of the expiration date? Or that new pair of running shoes when your old pair is just collecting dust in the shoe rack because you haven’t been using them? The value of the item on sale only becomes beneficial to you when you have an actual use for the product.
  • Additional principal payments can help you save interest payments. Talk to your loan servicer or lender and find out if you will be allowed to make extra payments on just the principal amount. Student loan repayment will be a little shorter because making payments against principal can pull the pay off date closer. It can also help you reduce the amount that you pay for interest over the life of the student loan.
  • Consolidate your student loans. Being on top of your student loan repayment is a must if you want to make sure that you are making the right payments and sending them at the right day of the month. This becomes more challenging as it is normal for student loan borrowers to have more than just one college loan account. This multiplies the number of details that borrowers have to keep in mind to ensure that the loans are all accounted for. This is where student loan consolidation comes in. This allows multiple student loan accounts to be combined to make even the administrative part of repayment a little easier. Just be sure to do research on the difference of federal and private student loan consolidation. One way to do this is to look at student loan consolidation reviews to see and weigh your options very carefully.

Getting behind student loan repayment

Repayment is a part of the student loan process and there could come a time that you might fall behind on your payments. As USNews.com reiterates that repayment protection should be a major component of why federal student loans is better than private studnet loans, there are still borrowers with federal loans who gets into delinquencyand worse, default. Here are the things that are most affected when you get behind with your student loan repayment.

  • Credit score. As soon as you miss a day of payment, you are already delinquent. And the lenders normally report late payment around 90 days. When you get to 270 days or nine months without a payment, you then default on your loan. These scenarios reflect negatively on your score. There is no exact computation on how many points your score would lose because there are a lot of factors that comes into play. Credit history and even your debt-to-income ratio. One thing is for sure though, your score will get a hit and suffer if you do not focus on your student loan repayment.
  • Wage garnishment. This can happen when your federal student loans are in default but you are currently employed. The government can intercept and demand your employer to send them a check as payment for your student loans. This goes the same for your tax refunds or if you hit the lottery.

Increase in student loan borrowing

WSJ.com shared that there will be more borrowers who will enter student loan repayment because there was a $20 billion increase from $38 billion to $58 billion in net cost of student loans in 2012 and 2013. This only goes to show that there are more and more students who are using college loans to get a degree. It is important to understand how the loans will affect their future especially when it comes to repayment.

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Getting On The Hook For College Debt

Graduate with MotherHigher education is now usually synonymous to college debt. Young children are being raised by their families, societies and even media by consistently pointing out the importance of a college degree. And there are even college degree holders who want to take it a step further and takes up post-graduate studies. And for most, the more education you pursue post high school, the bigger your college debt could become.

Children will have an idea of how they can become doctors or astronauts or even firemen when they grow up. Because they want to be able to save lives, put out a fire wearing those cool helmets and an axe or just see other planets, they form their dreams early on. Little do they know that college education costs a lot.

College debt is now affecting about 40 million Americans according to Fox17online.com. It means that there are more people in the US with student loans than the whole of Australia and Ecuador combined. That is a lot of consumers who has to balance their student loan payments together with their living expenses and other forms of debt or loans.

NPR.org explains that the total student loan debt amount is at $1.2 trillion to date. This is the amount that has steadily grown over the years and even in the midst of the Great Recession. Credit card debt and auto loans now have smaller debt amounts compared to student loans. With all these students racking up college debt, how much do you know about student loans?

Understanding some truths about college payment

As parents and children prepare for college education, understanding the payments for college debt is also an important matter. As the children decided on the course they want to take and the school they want to go to, the parents need to understand also some facts about the repayment of those student loans.

Co-signing a loan is not as easy as it seems

It is innate in parents to want to look out after their children even when it comes their finances. Yes you want them to learn as much as they can to do things on their own but there will be times that they will ask for your help. And when they come knocking in your door asking for help with their student loans, there is a big chance that it is about being a co-signer for a loan.

Both federal student loans and private student loans are able to accommodate parents helping out their children by signing-off a loan. But this is not just your signature and credit score on the line. You need to also think about the repayments on these loans when the time comes and for private loans,, this is sooner rather than later.

Federal student loans have more flexibility when it comes to repayment of their Direct Plus loans which are the only kind of federal loan parents can take out for their children. Private loans are stricter with repayment on the college debt. There are even reports where the student already died but the private loan is still being collected.

It will stay with you if you borrow the money for your child

If your child takes out a private loan under their name, they will be responsible in repaying that account. They are also able take out Direct Plus student loan under their name. The idea is that whoever takes out the student loan, they will be the one responsible in repaying that loan. But this is where federal and private loans differ.

For federal student loans, if parents take out a Direct Plus loan for their children, it will become their responsibility until the loan is paid off. But for private student loans, the lenders offer what they call a co-signer release on the college debt. The idea is to relieve the parent of the loan after some requirements are met. This is usually after a few full and on time payments are made on the account.

Federal student loans usually comes with a forgiveness program

This is one advantage of taking out a federal student loan over privately funded student loan. Public Service Loan Forgiveness Program allows a borrower to be forgiven of their college debt after a years of payment when they take up full time jobs in the public sector as shared by ED.gov. There also forgiveness programs for the military and even the national guard.

There are also repayment plans under the federal student loans that provides forgiveness on the payments after fulfilling the maximum repayment time frame. The Pay As You Earn Repayment Plan forgives the balance of the loan after 20 years. And the Income-Contingent Repayment Plan and Income-Based Repayment Plan or IBR forgives balances of college debt after 25 years of repayment.

Target a no debt college

This is quite hard and challenging to pull off but ultimately the most rewarding for the student. This takes a lot of preparation before the student even steps on to college. There are some tax-advantaged investment instruments available to be able to save up for a college fund to cover the cost of attendance in college.

It is also possible to look for free money that can be used to pay for expenses and stay away from college debt. Scholarships and grants can be part of the financial aid package but there can be other institutions or agencies that offer financial assistance to deserving students. It just takes a dedicated time to research these institutions. Forbes.com also shares a mobile app that helps you look for scholarships for college.

Lowering down the amount of college loans while in-school

A student can also make an effort to lower down the amount that they have to repay for college debt even while they are still in school. Here are a few things they can do to hopefully face a manageable student loan to be repaid.

  • Know how much you need to borrow. It is best to know how much you actually need in college to manage your borrowings. There might be some extra funds from your parents that you can use to lower down the amount of student loan that you have to take out. Overborrowing can give you refund checks that you can use for other school expenses but this is also a temptation in the hands of young people who cannot grasp yet the effects of student loans in their future.
  • Get a part time job to pay for miscellaneous expenses. Getting a part time job allows the students to offset some expenses while still in college. It can be food, transportation and even books and supplies. More than the funds, this gives the the student some valuable experience especially if the job is the same industry where their major will lead them after graduation. This makes job hunting a little bit easier compared to looking for a job without any prior experience.
  • Make in-school interest payments. This will help the student make payments on the original capital amount especially for unsubsidized student loans. The reason for this is that the interest payment on unsubsidized student loans will accrue over time,if not paid. The total amount will then be added to the original amount where interest will be paid increasing the capital amount and essentially the monthly payment as well.

College debt has been attached to college education because of increasing cost of higher education. But there are ways to address them starting with understanding how the loan payments work.

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Young couple looking at a house shaped cloudBuying a dream house is a great realization of one of your life’s main goal. You can now start to build a family and have little kids playing in the front lawn with your dog trying to run with them. Weekends would mean grilling food with your friends and neighbors at the back yard. while the children are swimming in the pool.

With this scenario playing in your head for as long as you can remember, you troop to a private lender to apply for a mortgage loan. As you sit there, your college life flashes right in front of your eyes. You see all the times you had to ask your parents help in filling-out the Free Application for Federal Student Aid or FAFSA. You now start a mental count of all the student loans you took out and used to pay for college.

There are a lot consumers who are looking to get the same dream. And there are actually a lot of people who are already making payments on that dream house. In fact, Federalreserve.gov shares that the total outstanding mortgage debt as of first quarter of 2014 is at $13.2 trillion. Only the student loan debt amount comes close to this at $1.2 trillion.

As you do the mental computation, you hope that the lender can see through your college debt amounts and see that you have the potential to be earning big amounts in the coming years. You hope that they see your employment will be a steady source of income and understand that your salary will have nowhere to go but up.

Challenges in purchasing that dream home

There are quite a few challenges in buying a dream house and the most glaring obstacle are student loans. This is especially true for recent graduates or for students who have simply separated from school. The student loan, which allowed the student access to higher education is now a prohibitive amount as they try and pursue their dreams armed with a college education.

There are some people who feel that they are being punished for wanting to better themselves and get a college education. Their desire to have a better life comes at a hefty price in the form of college debt. And those goals like buying a dream house now seems much farther from realization. Here are some of the problems of consumers who want to get a mortgage loan but has student loans

  • High student loan debt. The amount of student loan will play a part in the overall assessment of the lender of your application. It is not the only thing they will look at but it can influence their decision to approve your loan. The bigger your debt, the higher your debt-to-income ration will be. This is what lenders look at to verify how much more income you have to make possible payments of the mortgage loan. The higher the ratio, the bigger the possibility of possibly skipping a payment when faced with tough financial challenges.
  • Inability to save up for a downpayment. The bigger your student loan payment amount, the harder it is to save up for a downpayment on the house. Once you graduate or simply separate from school, there is more to life than just student loan repayment when it comes to expenses in the household budget. There are living expenses to think about and possibly some credit card bills. You might also be renting which will increase the monthly expenses. All these factors contribute to a smaller amount that you can put aside for downpayment.
  • Starting salary is not ideal for mortgage payments. With all the expenses every month, your starting salary might not be able to accommodate all the payables every month especially when a mortgage payment is added. It may still be able to barely cover all the payables but not having anything left after settling all financial obligations can set you up for debt down the line.
  • Credit history is also important. This is something not all graduates have worked on or prioritized while still in school. The main agenda was to pass and graduate with the degree. But the credit score is one important factor for the lenders. They see this not as the applicant’s ability to pay but the borrower’s attitude towards payment. The higher the score, the better they are in handling payments. The lower the rating, it means that there is a big possibility that they might miss the mortgage payments just like the other payment they have missed in the past.

Addressing the challenges to make that purchase

With all these in mind, how will a graduate proceed in buying a dream house? Are they left with just the repayment on the loan and settle for a rent? Graduates need to remember that there are always solutions to problems. It may not directly solve the issue but there are ways to soften the blow. Here are a few things that could be considered to increase the chances of getting that dream home in spite of a high student loan.

  • Consolidate your student loan. This is a great repayment program once you start repayment on your student loans. It is important to look at student loan consolidation reviews to look for the best company that can help you in your goal of making repayment as easy as possible. These experts can help you look assess your current situation and with that, look at various options available especially in repayment.
  • Income dependent repayment. Once you consolidate your student loans, it is best to look for an income dependent repayment plan. There are about four of these types in federal student loans according to ED.gov. These are Income-Based Repayment Plan, Income-Contingent Repayment Plan, Pay As You Earn Repayment Plan and Income-Sensitive Repayment Plan. This can help you lower down the amount you have to repay for your student loans.  Though you must understand that it will also increase the interest payment over the life of the loan.
  • Weigh the option of a private mortgage insurance. If you are really unable to make the 20% ideal downpayment in buying a dream house, you can still  opt for a lower downpayment. But you will have to factor in payment for a private mortgage insurance or PMI. This covers the lender in case you default on the mortgage loan. This amount will be added to the monthly payment. Compare the amount of your monthly mortgage with PMI versus your rent.  If the former is lower or just slightly higher than the rent, then that might just work.
  • Establish yourself first or look for extra source of income. Your salary negotiation skills will be put to test in your interview before you join in the company. Most businesses will really have a set salary amount for new hires and there is nothing you can do about it. While you are trying to prove yourself in the workplace. consider looking for a part time or a side business you can operate on a flexible schedule. An added source of income can be a great advantage when you are buying a dream house.
  • Pay on time all the time. To address the credit score, try to make payments on your financial obligations on time all the time with the right amount or higher. Making payments on credit cards in a timely fashion can help improve your credit score. This goes the same for your student loans. While you are preparing to make that home purchase, do not forget to make payments on your student loans because missing them might hurt you in the long run.

Minimizing the effects of student loan while in school

ASA.org shares from a recent survey of student loan holders that about 75% of the respondents said that their student loan has, in one way or another affected their decision in buying a dream house. This is a big number and would have an adverse impact on a consumer driven economy.

Buying a dream house should not start when you are already sitting on the chair across a lender. It should start earlier in life and that desire can help guide you in making better financial decisions especially with student loans.

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Steps To Appreciate Consolidation Reviews

Business holding a magnifying glassConsolidation reviews are able to help a lot of student loan borrowers in choosing the most appropriate company to help them in consolidating their college debt. This is an important part of the process especially as the students are graduating year on year with an increasing debt amount on their rookie shoulders.

According to USAtoday.com, 2014 graduates are looking at $33,000 average debt amount. After all their hard work in college, they need to exert more effort in repaying that amount. And this is a tough challenge right out the bat. This amount could already set the borrower off on a high note if it was not a debt to be paid.

It can put a downpayment on a house, a nice fund to kickstart retirement savings, it can also be a safety fund for emergency situations. That amount could also be used to fund capital requirements for a start-up business venture. But instead of all of these, the borrower needs to raise this amount only to pay to student loan lenders.

But this is the tail end of the program and a borrower must also take into consideration that that amount was also an investment into getting a good and quality education. That is a potent tool in trying to land a high paying job or at least a decent one where they can work their way up the corporate ladder.

But even with this, student loan borrowers about to enter repayment need all the help they can get and this is where consolidation reviews can come in. Loan consolidation is a great and effective tool in making sure that the debtor is able to meet all the financial obligations by streamlining the administrative part of repayment.

How to find what you need to appreciate consolidation reviews

Just like in most things in life, the advantages of any service is only as good as the need of the borrower. But even before getting to that, a debtor would benefit in understanding a few things about their need and how it translates to finding the right company to help them consolidate their student loans.

  • Accept your current situation. This is similar to all those 10-step self improvement process where the first order of the day is accepting that you need help. All the benefits and advantages of consolidation review would not amount to anything. After accepting that you are in a situation where help is a welcome reprieve, the rest can come easy.
  • Figure out your stress points and what you need. The next step is finding out the areas where you need the most help with. It could be making the payment on time, lowering down the monthly amount or locking in an interest rate. It is best to list them all down and prioritize one by one.
  • Understand the concept of loan consolidation. The next step is understanding the real concept of loan consolidation. The main role of the program is to help the borrower make the repayment on the student loans as easy as possible by combining all the student loans under one account. This is where all the benefits emanates from.
  • Look for the benefits you need. Consolidation reviews lists down various services of top student loan consolidation companies in the industry. These services becomes a benefit and an advantage to you depending on your need. It is best to look at these services with your need on top of mind. This can help you screen and look for the services that you really need.

Remember these tips before choosing the company

As consolidation reviews help a borrower look for the bset services out there in the industry, there are some things you needs to be remembered before signing on the dotted line.

  • This will be a longtime partnership. One of the things that most student loan borrowers tend to overlook is that the working relationship with the consolidation company will not be a short stiny. It will be a years of working together in paying off the student loans. If the repayment period is 25 years, that is 25 years of working with the company.
  • You need to be comfortable with the company. If the working relationship is that long, the borrower needs to be comfortable with the company they are working with for their student loans. More than the professional working relationship, the company must be attuned to the borrower’s needs and priorities and have a proactive approach on your account.
  • Other people’s seal of approval. Customer feedback is important to look at and consider as well. This is because the company is offering their services and would always put their best foot forward. But current and previous clients of the company will not sugarcoat any shortcomings of the company. They will air their side of the story. It is best to listen and read what their experiences are with the company.
  • Industry stamp of professionalism. Another voice of authority are the industry associations. They monitor and oversee the programs and function of different companies under their watch. They also mediate on consumer complaints like the Better Business Bureau or BBB. Look for consolidation companies that are members of these types of organizations and the better standing they have, the more it reflects on their professionalism.

Contributing to consolidation reviews

Consolidation reviews are often done to highlight the services of different consolidation companies in hopes of reaching out to student loan borrowers about to enter repayment and thinking about consolidating their student loans. But borrowers who are already in repayment and consolidated their college debt with the help of professional companies can pay it forward and help other debtors make the right choice.

  • Put in you honest assessment of the company. Other borrowers who are still undecided on who they will get to consolidate their student loans can benefit from your experience. It can be by leaving a comment on the company’s website or writing about your experience in a blog. It can also be by getting in touch with industry association especially if you have a complaint. This can help future borrowers get a feel of how the services are of the companies in student loan consolidation reviews.
  • Report any illegal activities to warn other borrowers. This should always be part of the deal. As you praise the people behind the company for a job well done, you should also be quick to point out the inconsistencies in the services. It could could include up front fees which Investopedia.com explains is a sign that borrowers need to be skeptical becuase payments are deducted from payments and not front loaded.
  • Share your experience with people close to you. This can include your friends in school or your younger relatives who are just about to enter college. The lessons you have learned in  taking out student loan while in school can be a valuable jump off point for the young ones who are just about to get a taste of student loans. It might also be just what your colleague is looking for as some of them could be struggling with college debt repayment.

Consolidation reviews are a great source of information. But appreciating the advantages of their services is understanding in parallel your needs as a borrower.

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Young businesswoman looking sadLooking into consolidation reviews can help consumers and the industry in a lot of ways. The benefits it brings are usually the basis of some borrowers to go into loan consolidation. After looking into various benefits of loan consolidation, there are a good number of borrowers who prefers to enjoin the services of professionals to help them in loan consolidation.

A borrower can opt to go through a loan consolidation on their own and and for federal student loans, there is normally no cost to it. It is as easy as logging in to StudentLoans.gov and putting in your loan details to get started. For private student loans, the process is similar to when a borrower first took out a student loan. If it is this easy, why is there a need for a debt consolidation company?

Advantages of getting a debt consolidation company

Getting a debt consolidation company has advantages that a borrower might not realize at first. Yes, doing it on your own can save you some money but hiring a professional lowers down the margin of error. Imagine doing taxes on your own where missing out some important details could be costly. Or if you think detailing the engine of your car is as simple as a bucket with water and sponge then you are in for a big surprise and big costs.

But taking on the services of professionals ensures that you do not skip declaring some income or forgetting to deduct some exemptions. This brings your taxes to a more realistic amount. Driving off to a detailing shop will ensure that the proper liquids and solutions are used on your engine to get is as close to showroom detail as possible. Once in the shop, they can even check the car and look for possible repairs that you might need.

In all these, the obvious and top reason for getting a debt consolidation company to handle student loans is expertise. They have the skills and experience to make sure that you understand your options and that each of them takes into account your unique situation. They are able to lay all them out so you can make informed decisions.

Consolidation reviews helps a borrower in default

With the main benefit of student debt consolidation companies being expertise in the matter, how can consolidation reviews help a borrower in default? How can comparing the services of each company help get a borrower out and stay out of default? Well, consolidation reviews can do that and so much more.

Loan consolidation is one way out of default.

There are three ways of getting out of default. The first one is paying the full loan amount. This is because when the loan went into default, the full balance becomes due and payable. The second is loan rehabilitation. This is where the borrower and the lender agree on a voluntary amount and repayment time frame in order to bring the account to current. Of course the succeeding repayment amounts would be higher than the original due to some added fees coming out of default but the federal repayment plans and payment postponement options are again available to the borrower.

The third option is as ED.gov mentions, consolidating federal student loans is one way to get out of default. This can be done either through a loan rehabilitation before consolidation or going straight to student loan consolidation but only choosing between Pay As You Earn Repayment Plan, Income-Based Repayment Plan, or the third is  Income-Contingent Repayment Plan as payment options.

Customer feedback is an important barometer of company service

One way consolidation reviews help borrowers is the ability to gauge the services as against the actual experience of the customers. It is very impressive to list down a lot of products and features but the ability to dispense the same to clients and how effective it is will always be a good sign of a great company.

Take for example a co-signer release for private student loans. Consumerfinance.gov shares that there are quite a few private student loan borrowers who are having problems releasing co-signers from the account. At first glance, the feature is a great advantage to a borrower because the co-signer will be released from accountability after a few monthly and on-time payments. They would later on find out that there are a lot of requirements even before releasing the co-signer. The comments and opinions of these customers are very helpful in letting other borrowers know their challenges in the said loan feature.

Consolidation reviews explains fees and payment procedures

A borrower in default would most likely be in a financial struggle already. It could because of a medical emergency that is why they are behind payments. It could also be because the borrower was laid off work and there is no steady stream of income to meet the financial obligations including the student loan payments.

With that being said, how the debt consolidation companies will collect fees is important to a borrower. Consolidation reviews is already able to weed out scam companies who would demand high and unbelievable rates. These are the types where if a borrower falls prey, he would end up in a bigger hole than he already is.

Consolidation reviews can help a borrower look at how debt relief companies are charging rates Asking for an upfront payment should never be done and is not allowed by law. There are some who opts to charge borrowers a monthly recurring fee that acts like a retainer fee for the services of the company.

But there are those that prefers to get paid after the job is done. There are debt consolidation companies who prioritizes the situation of the borrower first before being paid. They explain the various repayment options available to the borrower, look at how each of them applies to the situation and helps the borrower reach a decision. After the borrower is happy and is enrolled in the program, that is the only time that they will talk about their fees.

Forcing the issue on the borrower

Student loan borrowers are already in a desperate mode and could be agreeing to the slightest hint of hope just to get out of their situation. Consolidation reviews also helps a borrower in default look at how the services are being offered to clients. It is important to look for a company that analyzes and tells a borrower if the program will work.

With this, there are debt consolidation companies that tells the borrower if they will be able to help them or not. They will never force their services and promise debt relief just to earn. Because of their experience, they know if a borrower will be able to take advantage of the repayment options or not.

Borrower default can use consolidation reviews

With all these benefits, a borrower can quickly look into consolidation reviews to help them choose the best debt consolidation company they can take on to fix their situation. It is possible to consolidate the student loans on their own but it is better to get the services of professionals. This allows for better decision making and less room for mistakes. Being in default, the last thing a borrower needs are more financial problems.

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Group of college studentsConsolidation reviews brings a lot of benefits to student loan borrowers especially for those coming in and looking to try consolidation for the first time. And the class of 2014 would be in the best position to take advantage of it. More than the fact that they are just getting started with repayment and the first time to consider loan consolidation, the batch also is also the most indebted in the history of the college graduates in the US.

As WSJ.com shares, the new batch of college degree holders is also holding an average of $33,000 in student loan debt. That is an amount that could have been used for other financial goals. A mortgage loan could be started with a downpayment for that amount. It could also equate to a nifty new car or for some, it can already open the door to opening a start-up business venture.

And the repayment outlook does not seem to be a an encouragement to borrowers about to start making payments on their college debt. Newamerica.net reports that for the first quarter of the fiscal year 2014, the total outstanding loan amount due to default is at $95.9 billion. And with about 6.8 million borrowers making up those that are in default, the average amount among them that has not been paid in nine months is at an average of $14,103 per borrower.

Having the biggest student loan debt amount and a not so nice picture of how default payments are, the class of 2014 should invest some resources in making sure that they understand their options on repayment plans and see how loan consolidation can help. There are a lot of debt consolidation companies out there and it is just a matter of finding out and separating legitimate ones from the predatory entities.

How consolidation reviews help 2014 graduates

Having a big student loan debt affect the borrower in a lot of ways not only financially. As Gallup.com survey shared recently, it is not only about the money when big student loans are involved. Looking at five aspects of a person’s well-being, those with high student loans are falling behind in four of the five points – purpose, financial, community, and physical.

As the class of 2014 tries to consolidate their student loans and peruse through several reviews,here are a few of the benefits that they can get from doing this.

  • Looking at benefits offered by consolidating student loans. One of the best things about consolidation reviews is that they are able to lay out the benefits of each debt consolidation company. This way, a borrower looking to consolidate student loans can look at the different benefits from various groups all at the same time. This saves the time and energy in trying to look and collate all the information from different sources.
  • Staying away from scam companies. With all the desperate student loan borrowers trying to find a quick way to get out of debt, there are some who fall victim to scam companies. One of the main reason for this is because they believe empty promises and hands out money in hopes of getting rid of student loans. Consolidation reviews present legitimate companies and weeds out predatory entities.
  • Preventing further debt. This is more of what a borrower can do in choosing the most appropriate debt consolidation company to help them with their student loans. Working with the company that suits your needs can help you stay on the path of repayment and prevent backsliding down to further debt.
  • Making informed decision. One great thing about consolidation reviews is the fact that most of the information that a borrower needs is already in one place to choose the best student debt consolidation company. Rather than trying to feel lucky in choosing a debt consolidation company, making the decisions based on accurate information can be advantageous for the borrower in the long run.

What to look for in loan consolidation companies

As the class of 2014 studies consolidation reviews, here are a few things they can look for in each company that is being reviewed.

  • Clean and simple website layout. With the advent of technology and the influx of information over the internet, there are a lot of theories on how best to present them to the consuming public. This is one of the challenges in looking for the information you need. Look for a website that can present the information you need in a clear way and not have to click through a lot of pages to locate them. With that being said,  a clean and easy to navigate site is important as it saves you time in looking of the information you need.
  • Industry articles. Student loan consolidation companies would need to have industry articles to help their clients get updated with the latest news and trends or breaking news. It is an added plus service and one that benefits the readers more than the company.
  • Repayment plans and company services. Consolidation reviews can also help a borrower by looking for the company that best describes each repayment plan especially for federal student loans. On top of that, debt consolidation companies should be able to match the specific situation of the borrower with a repayment plan after loan consolidation.
  • Professional support. Consolidation reviews can also help borrowers look for a company that provides professional support. One way to look at this is the industry affiliations of the companies. One specific association that can say a lot about a company is being a member of the Better Business Bureau. Another one is the International Association of Professional Debt Arbitrators that trains the people that will be handling the account.

How to make the most out of a consolidated loan

Choosing to consolidate student loans is a great way to make repayment easier. But there are some tips to make it work to a borrower’s advantage.

  • Do not consolidate loans when in despair. You will have a hard time making solid financial decisions when under duress. Being in panic can lead you to make hasty decisions that you might regret later on. Be sure to know all the variables and information before making a decision to consolidate student loans.
  • Student loan consolidation will not solve the problem. Even consolidation reviews can only do so much, consolidating student loans can help a borrower make the administrative part of repayment easier but it is still up to the borrower to make the payments. Although there will be one account to monitor, it still needs to be managed and that is up to the borrower and the not the program.
  • Do not skip a payment. It is hard enough to make the regular payments but skipping them will not only make the succeeding payments harder but the credit score will be affected as well.
  • Make extra payments. It is best to try and make an extra monthly payment as possible. It can help to act as a payment buffer for your monthly checks. If you are making two to three months ahead, that is 60 to 90 days of emergency payments.

Consolidation reviews can help a student loan borrowers choose the best loan consolidation company they can work with. Especially for the class of 2014 who, at the moment holds the distinction of having the highest student loan debt average.

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