Student loans debt is the second highest form of debt facing Americans today, just after credit card debt. College financings is a catch-22 in that you took the time and expensive to build your education and plan for a better future, just to be left at the end with a mountain of debt and the need to find a job with all that education. Student loans debt is permanent, meaning you can not get rid of it with bankruptcy.
When looking for a way to deal with student loans debt, it's important to understand the different loans you have and formulate a plan to deal with and pay off each of those loans in the best way possible. There are many ways to do this, you can pay off the loans separately starting with the highest balance or highest interest rate first, while still making the minimum payments on the others, or you can consider getting a debt consolidation loan that is specifically designed for student loans.
Debt consolidation loans allow for you to take all your student loans debt and roll it over into one loan with one interest rate and one monthly payment. It works by allowing you to get another loan that then pays off all the existing loans, leaving you with the single loan. The key for this to work in your favor is to get a loan big enough to cover all your student loans debt with an interest rate lower than the ones you were paying and a monthly payment you can handle. Another way to make debt consolidation loans work better for you is to first negotiate with your creditors to see if they will take a settlement amount that is lower than the current balance. This will make your new loan smaller than it needs to be and easier to pay off.
If you want to work to pay off your student loans debt by yourself, then it's important to put together a list and some information to help you be successful in doing so. Make a list of all your student loan creditors with current balance, interest rate, monthly payment, due date and contact information. This will allow you to see the largest loans and those with the highest interest rates, which should be your first focus on paying down. While, you are working to pay those loans down you must continue to pay the minimum payments on the other loans to avoid default. Then once one loan is paid off, you take the amount you were paying and apply it to the next highest loan amount or interest rate.
Regardless of the method you choose to use to pay off your student loans debt, it's important to make the right decision for you and your financial situation in order to start your new life off on the right start.
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