Student Loan Tips

Figuring out how to pay for school isn't easy. Here are some tips to help you sort out your options and stay focused on paying for your education and making your dreams come true.

1. Working part-time while you are in school can help you pay for tuition and other expenses, but working too much can hurt your grades and chances of graduating. If you are in school full-time, try to limit your part-time job to 15 - 20 hours per week. You can always heap on more hours during school vacations or over the summer.
2. If your financial aid package includes student loans, talk your school's financial aid office to see if you might be eligible for more grants (money you don't have to pay back).
3. If your (or if you are a dependent student your parent's) financial situation has changed drastically due to job loss, home foreclosure, bankruptcy, etc. than contact your financial aid office to discuss the circumstances to see if your financial aid package can be adjusted.
4. Keep track of your loans! If you need to borrow loans it's possible you'll accumulate several of them over the course of your college career. Keep copies of the paperwork you signed in a safe place. This might seem like a no-brainer, but six months after you graduate you'll going to need to start paying back the loans including the ones you took out for your freshman year, four or five years prior. If you don't have the details it can be a hassle to track them down, so save your paperwork now and save headaches later.
5. Keep on top of your loans' Grace Periods. Different loan types have different grace periods. A grace period is the amount of time after leaving school you have before you need to make your first loan payment.) Grace periods for private loans vary. For Stafford and many other Federal loans it is usually six months. For Perkins loans it is nine months. Know how long you have before you have to pay - and remember you don't have to wait that long. If circumstances permit you to pay off your loans early -- do it! It will save you money in the long run.
6. Make sure to give your lenders your up to date contact information. It's not unusual for students to move several times during school or right after graduation. Make sure your lenders have your current address, phone number and email. It's important to stay in touch and for your lender to be able to contact you.
7. Never, ever blow off your student loans! If you can't make your loan payments, don't ever ignore them. Ignoring your loans can have serious consequences that can haunt you for life. Lenders will usually work with you if you cannot make payments, but you have to take the initiative and contact them. Explain your situation - whether it's due to unemployment, health related issues or you deciding to go back to school. Ask them what you can do to keep your student loan account out of delinquency and default. After all your hard work earning your degree the last thing you want to do is ruin your credit.
8. Pay off your high interest loans first. Compare the interest rates of each of your student loans. If you have a mixture of private and federal loans concentrate on paying off the private ones first by maybe sending them a little extra each month. Private loans usually have higher interest rates and don't offer the flexible repayment options that federal loans do.
9. Look for repayment discounts. Making your loan payments electronically can earn you a 0.25% reduction on your interest rate. Some lenders offer an incentive or reward after you make a certain number of on time payments by reducing your interest rate.
10. It's always good to pay down your debt, but be smart about it. If you have a high balance on a credit card with an 18% interest rate and a Stafford loan balance with a 6.8% interest rate it makes better financial sense to try and pay off the high interest credit card first while making minimum Stafford loan payments.

Most importantly, don't panic. If you have concerns about making your student loan payments don't ignore them. Open a dialog with your lenders and work through it. It's a struggle for many people to pay back their student loans, but eventually most find a way.