Sallie Mae student loans are as commonplace for college students throughout the United States as student centers and dining halls. Equally common is the question of how to repay Sallie Mae loans following graduation. Learning how to refinance Sallie Mae student loans is an important option for borrowers. Selecting the right student education loan repayment plan is a step in the right direction.
For borrowers of federal student loans, there are many different options for repaying student loans. These options include:
- Standard repayment plan for student loans
- Extended repayment plan for student loans
- Graduated repayment plan for student loans
- Income-based repayment plan for student loans
- Income-contingent repayment plan for student loans
- Income-sensitive repayment plan for student loans
- Pay-as-you-earn repayment plan for student loans.
For borrowers who do not qualify or do not benefit from one of the alternative repayment options, student loan consolidation is often the best choice.
No one says the twenties (or thirties) are an easy financial time in life. Though, many students wrongly believe the financial restrictions of college life are left behind once they graduate. Now, though, financial obligations are increasingly in the graduate’s own name. Perhaps parents or guardians helped out with extra expenses or college payments while students were in school.
What’s most important is maintaining and building a strong credit history. This means making timely credit card, student loan and car payments. Borrowers are now tasked with juggling more. They have to think of saving money and keeping credit card balances to a minimum. Paying back student loans on time is crucial to future financial success.
All the requirements of student loan repayment sound daunting and impossible for many who are entering the workforce. Surely employers should pay more just because graduates are carrying a huge burden of student loan debt. When they do not, graduates need to consider a few options. One of the best option to is refinance a Sallie Mae student loan. Private lenders offer loan consolidation options at rates that vary based on a borrower’s individual circumstances.
Borrowers need to assess their unique situation when shopping for a Sallie Mae loan consolidation offer. How much do they owe? When are the loans due? How many loans do they have? Paying interest on seven different loans might spread the borrower’s payments too thin. Instead, loan recipients need to consider consolidation of their loans.
Sallie Mae makes it fairly easy to consolidate loans online. Filling out simple forms makes for a quick process. Consolidating loans is akin to refinancing a mortgage. It may mean lower payments and lower interest rates. It is a tool that many borrowers use to avoid default.
Borrowers should do their best to stay clear of defaulting on loans. The reason? Well, defaulting makes it harder to consolidate loans. In particular, defaulted Direct Loans cannot be consolidated again. Not paying the loans in a timely manner makes for a difficult time getting help and ruins credit.
If there are signs the financial difficulty is too great, contact the loan servicer and creditor immediately. Sure, the lender wants their money, but also wants borrowers to thrive. Financially speaking this translates into a range of repayment plans. Some loan repayments start out with lower payments and gradually increase over the course of the loan. This is what is known as a Graduated Repayment Plan.
Income-based Repayment plans are specifically worked out based upon the borrower’s income and expenses. It may involve extending the terms of the loan from 10 years to 20 years or 25 years. Additional options, which are considered last resorts include deferment and forbearance. Because the interest still accrues while under deferment, it may make sense to consolidate first. Consolidation decreases interest and makes for more amicable repayment for borrowers. It is a popular avenue to ease the financial burden for borrowers.