Student Debt Help

Written by Mark Sanfilippo
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It's a shame that most colleges don't offer a course in managing the debt incurred by attending their schools. To the student just out of high school, making decisions about tens of thousands of dollars of debt can be daunting. Since school loans are unlike most other loans, oftentimes parents can be of little help in determining a proper loan strategy.

There are some important things to remember about student loans that will help you understand your debt. First, you should know whether or not you have subsidized or unsubsidized loans. This will make a difference in whether or not you accrue interest charges while you're attending school. Oftentimes, students have a combination of both subsidized and unsubsidized loans.

Additionally, you should know your options in terms of deferment and forbearance. Deferment is a way to essentially stall your payment schedule. Most lenders have specific requirements for going into deferment and oftentimes these are income based. Forbearance is similar to deferment, but the main difference is that during the forbearance period, interest continues to accrue, thus adding to the total amount of your principle.

Managing Your Debt Is Essential

It is absolutely essential that you work with your lenders to find a good way to manage your student debt. Failure to do so will result in your loan going into default. This can have extremely negative long term effects on your credit rating. Most lenders are willing to work with you to create a repayment schedule that fits your financial paradigm. If you happen to have several student loans of varying interest rates, you might want to consider loan consolidation.


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