How will I pay off my student loans? How long will it take me to pay back my student debt? These questions may run through your mind often. With the cost of education continually rising, it is no wonder people are worried about how they will pay for education. According to studentloanhero.com, With over 43 million American borrowers, they owe over $1.74 trillion in student loan debt. Whether you are just starting college, just graduated, or have been out of school for a while, consider these tips to help pay off your student loan quicker.
Make An Extra Payment
Making an extra student loan payment each month is a great start to paying off your debt faster. Your extra payment can be of any amount. Remember that a little adds up. It is important to pay at least the minimum each month. Every few months, you can consider making an extra payment. Make sure to let your lender know that the additional money you are paying will be going towards an extra payment and specify that it is for principal only. This will limit the amount of interest that adds up. Without this step, your lender may hold the extra payment and add it to the following month’s payment. While this may not seem like a bad option, it turns out that you will be paying more interest.
Refinance Your Student Loans
Refinancing student loans is a great way to help pay off your debt faster. So why should you refinance? Refinancing helps to lower the interest rates, allowing more of your payments to go towards your student loans. One option you can choose is to refinance multiple student loans. This will give you one consolidated loan that has one monthly payment. You can also choose to refinance only one loan for a lower rate. It is important to refinance loans where you will be able to decrease your interest rates.
Pay More Than The Minimum
If you are able to, paying more than the minimum payment each month is a good idea. You can pay the minimum payment with no penalty. Since interest is always accruing on your principal balance, paying more than the minimum can help reduce the cost of your student loans. Use the repayment estimator to find out your estimated payments HERE.
Lump-Sum Student Loan Payment
Whenever you receive a bonus or tax refund, it is a wise idea to apply a large chunk of it towards the principal of your student loan payments. It is a great way to help decrease your student loan payment for the future.
The Family Credit Union
If you or your child is just getting started with college, The Family Credit Union located in the Quad Cities offers a private student loan program to help pay for additional college expenses. They also offer local scholarships you can apply for. The Family Credit Union is here to help you or give you advice on all of your educational expense needs.
