Educational Loans : 4 Ways to Take Control of Your Student Loans Before You Graduate

1
Educational Loans
2

• 4 Ways to Take Control of Your Student Loans
  Before You Graduate

3

• For many students, loans are as fundamental a
  part of college as ramen noodles and
  all-nighters. Just because you need them to fund
  your education, though, doesnt mean you should
  borrow blindly until graduation comes around.
• A lot of times, students make the mistake of
  not looking until right before theyre going to
  graduate and are shocked at the amount that
  theyve borrowed, says Nicole Solomon, assistant
  director of outreach and communication for the
  financial aid office at West Virginia University.
• Take these four steps to minimize your loans, and
  youll be in a much better position to pay them
  off and focus on the fun parts of post-college
  life.

4
Know how much you need and take only that.

• Your college will decide how much federal loan
  money to offer you based on the results of your
  FAFSA. After your school takes into account the
  need-based aid, grants and scholarships youre
  getting, it will offer you loans up to the cost
  of attendance.
• But not all students need to take the full amount
  of loans theyre eligible for. Maybe you worked
  over the summer and saved up a few thousand
  dollars, which wouldnt be reflected on your
  FAFSA, and you want to put that toward tuition.
• Just because its been disbursed and paid to
  them, it does not mean they have to keep that
  loan,

5

• Most colleges have a financial aid page where you
  accept your loans online at the beginning of each
  school year. Before you accept your annual award,
  look at the balance youve accrued so far and
  think critically about whether you need the full
  amount. You can accept a partial amount of the
  loans offered, or accept it all and then return
  any unneeded portion within 120 days of the
  disbursement date.
• Monitor your loans throughout the year, to keep
  aware of the debts youre taking on, and further
  reduce the amount you need to borrow by cutting
  costs wherever you can. Rent your textbooks
  instead of buying them, opt for a cheaper cable
  package if you live off-campus or rely on public
  transportation rather than a car if thats
  possible.
• In other words Live like a college student when
  youre in college so youre not living like a
  college student for the next 10 years after you
  graduate,

6
Pay the interest on your loans while youre in
school.

• Private loans and unsubsidized federal loans
  accrue interest while youre studying. When you
  start repaying them, that interest will get
  capitalized, or added to the principal balance of
  your loans so youll effectively pay interest
  on the interest that added up during college.
• For instance, an 8,000 loan you took out
  freshman year at a 3.86 interest rate will
  accumulate 308.80 in interest each year youre
  in school, or 1,235.20 total. When you graduate,
  youll have to pay back 9,235.20, and 3.86
  interest will be tacked on to that higher amount.
  Itll take longer to reduce your balance than if
  youd paid off that 308.80 every year.
• But since doing so isnt required, and mail from
  servicers is easy to ignore, many students dont
  take advantage of this option.

7

• They get a bill for it, they just dont have to
  pay it, says Jefferson Blackburn-Smith, vice
  president for enrollment management at Otterbein
  University in Westerville, Ohio.
• Every year, your loan servicer or lender will
  send you a billing statement showing how much
  interest has accrued on your loans. Log in to the
  servicers online portal to pay it off before it
  capitalizes, and youll keep your loan balance
  from swelling when you start repayment.

8
Understand your repayment options before exit
counseling.

• Even if youre keeping track of how much money
  youve borrowed, you might not realize how that
  translates to a monthly payment after graduation.
  Federal Student Aids Repayment Estimator tool
  allows you to enter your loan balances, interest
  rates and projected income to see what youre
  likely to pay.
• Youll notice you have options beyond standard
  repayment, which breaks up your loans into 10
  years worth of fixed monthly payments. You can
  choose graduated repayment, during which the
  amount you owe increases every two years, or an
  income-driven plan like income-based repayment
  (IBR),which caps your monthly payments at 10 of
  your income and forgives your loans after 20
  years if you qualify.
• Just knowing about IBR before youre prompted to
  pick a repayment plan during your required exit
  counseling session will keep you from paying more
  than you need to when you start repayment,
  Blackburn-Smith says.
• I dont think families think about IBR yet
  its not thoroughly
• understood and so not as many students look
  into that at graduation as they should, to
  understand if this is something that would be
  meaningful for them.

9
Do your best to graduate in four years.

• The sooner you graduate from school, the less
  money youll owe. Its a simple formula, but one
  that a lot of college students dont consider
  when theyre deciding how many credits to take
  each semester.
• I dont think students think about that, when
  theyre dropping a class that isnt conveniently
  timed for their schedule, what the implication is
  when they leave school.
• You can graduate in four years by taking a full
  course load each semester or enrolling in summer
  classes to catch up on credits, especially if you
  switched schools or majors. Decide on a course of
  study by the end of your sophomore year so you
  dont have to take additional classes to meet a
  new majors requirements.
• Its something that they just need to be
  thinking about, because that extra year of debt
  really is problematic for some students,

10

• Smart Educational Loans repayment starts sooner
  than you might think. Get ahead of your loans
  while youre in school, and youll be much less
  likely to owe more of your precious first
  paychecks than you thought you would.
• Sourcehttps//www.nerdwallet.com/blog/loans/stude
  nt-loans/student-loans-before-you-graduate/

11
https//www.facebook.com/AvanseEducationLoan
https//www.linkedin.com/company/avanse-financial-
services
https//twitter.com/avanseeduloan
https//plus.google.com/AvanseFinancialServicesLt
dMumbai
https//www.youtube.com/channel/UCcsuUx1EH1C08XmX2
embpug
12
Read more on Educational Loans
http//www.avanse.com/avanse-education-loans/
Thank You..!!!