 |
Apply - Payoff - Consolidate - Renegotiate |
School Loans: Deal or no Deal ?
There are very few students today who can complete their college education without a loan.
This isn't anyone's fault - college costs are simply higher than ever.
So... knowing that a school loan is a must... let the dreams begin.
The education you want (dream for) is achievable and there are a number of loan payment options.
Is a Loan Really Necessary?
You'll incur debt with all loans. So it's time to assess how much debt is necessary.
There are debt foregiveness programs in certain employment fields, such as the Peace Corps, some teaching positions and even Military enlistment.
However, it's safe to say these are not always popular options - so plan ahead!
The average college graduate leaves school owing about $20,000 in borrowed money. There is typically a 6 month grace period between graduation and commencement of loan payback.
Yes, there are some deferrals and some renegotiations - but debt is debt. It all adds up and has to be paid back.
So let's take a minute or two and assess how much we might really need to borrow before we even begin the paperwork drill.
There are a few questions to review:
- What school(s) am I considering ?
- How much in savings do I have set aside ?
- What is the total amount I expect to borrow ?
- What's the amount I expect to pay back ?
- Have I compared Federal Loans, Private loans ?
- What monthly payment amount do I expect to be able to afford ?
- Are there other options for funding - family, other relatives, etc.
Once you've looked over your options and checked your emotions for financing your education needs, take a step back.
What's possible ? what's reasonable and where do you go for help ?
How Do You Find School Loans?
Because of the high demand, school loan services are available from many different lenders. You can often begin with your selected college or university for recommendations.
Be careful here though - there was some recent criticism about schools taking "lender kick backs" and legislative enforcement is pending.
Your personal bank, credit union, or Sallie Mae are additional options. It's also not uncommon for parents and grandparents to utilize home equity to help finance education loans.
You can also search via the internet for various options on education loans. This can be a little trickier but once you've narrowed your choices, a personal interview and face-to-face negotiations are your best bet.
Thinking Ahead about Paying Back
Saving for college is always a better choice than having to borrow. However, we all know that reality speaks loudly and often. Sometimes life's circumstances simply prevent us from always doing what's best.
Some education loans offer loan deferrments, renegotiation plans and loan consolidation options that should always be reviewed when it's time to start your monthly payback plan.
It's often best to begin these discussions with your current lender. They have all the paperwork and can assess what options are available most easily.
School loans are a major financial decision and loan forgiveness is rare. Review all your options, think about the possibilities, decide on your best course of action, then give it your best shot.
