Where to Get Help with Repaying Student Loans

Students who do not have high salaries immediately upon graduation may have a hard time repaying student loans. While there are a number of loans that offer little flexibility or assistance with this problems, lenders tend to be the most sympathetic about student loans. They will be willing to work with you in most cases, but the most important thing to remember is to ask for help before you default on your loans.

Federal Student Loan Consolidation

Before your loans are in default, you may have the option to consolidate them if they are all federal loans. This does not just apply to students. Parents who have taken out multiple loans to assist their children in paying for college may also be eligible for consolidation. The process is very simple, and the federal government encourages you to consolidate and refinance if you will have difficulty fulfilling your requirements as they stand.

Federal Loan Forgiveness

Loan forgiveness is a program available to servants of the public. If you are working for an nonprofit or spending time in a program like Americorps, Teach for America or the Peace Corps, a portion of your salary can go toward your student loans. Ultimately, a large portion of the loans will be written off without any repayment if you are serving a public assistance organization.

Hardship Deferral

Both federal and private student lenders may be willing to offer you a hardship deferral for your loan. If your student loans already came with a grace period before repayment, this may be more difficult to achieve. However, if you have a legitimate reason why you cannot begin repayment yet, they you should approach your lender and ask about the option. One example would be illness or temporary disability. If you have had your employment deferred due to a slow economy, this is also a valid reason to ask for deferment.

Student Loan Repayment Plans

You may consider changing your repayment structure in order to incur less of a burden when you have a low salary immediately after graduating. This is an option on most federal and student loans. Income-contingent options only require you pay if you are actually making an income and may only take a portion of your income. Similarly, graduated repayment options charge less in the beginning and become more expensive as you advance in your career. This spreads the loan burden out over the course of your time after school, eliminating undue stress on you right at the beginning.

Private Loan Options

If you have only private student loans, you may consider modifying these in order to ease the repayment burden. Modification may take the form of refinancing, settling, consolidating or all three. Refinancing means you will take a new loan to pay off the existing loan. Your new loan will be at a lower interest rate with lower monthly payments. Settlement is a process of finding a one-time, lump-sum payment to completely cancel your debt. It should be lower than the total amount you owe. Consolidation is combination of the above, using one loan to pay off multiple loans. The new loan will have a lower interest rate, and you will only pay a portion of what you owe to settle the debts.


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