Student loans are the gateway to attaining your college education without having to cover the ever-increasing costs right away. According to the Chamber of Commerce, 60% of all students are faced with some form of debt by the time they graduate, adding to the mounting $1.5 trillion owed in student debt.

Depending on the loan type, you may have to make certain loan repayments while you’re still getting your degree, or you could be liable to start repaying your loans once you graduate. Either way, this is a milestone in your life that you shouldn’t just head into blind. While you might have done your research before you got your student loan, there’s still a lot you need to know about repaying them. Let’s take a look at some of them:

You Can Consolidate Your Loans
Consolidating your student loans is a viable option if you’re looking for greater flexibility and practicality. You can manage your loan repayment and keep your contributions on track by consolidating your loans into one, often with a new lender.

The benefits
Combining your loans into one offers a variety of advantages. The foremost benefit of loan consolidation is that it makes the repayment process hassle-free. Since you’re only obliged to pay for one loan, you don’t have to be bogged down by several monthly payments and keep track of different bank accounts.

Apart from offering greater organization, consolidated loans can potentially lead to lower payments. Since an entirely new loan is established, you have the ability to negotiate better terms, a longer repayment period, and lower interest rates. Take advantage of the current downward trajectory of interest rates to consolidate loans, repay your debts, and reduce the burden looming over you.



The drawbacks
Before you consolidate your loans, it’s essential to look at what you may stand to lose as well. Certain loans—especially ones from federal lenders—can offer various benefits such as loan forgiveness and varied repayment options. By opting to consolidate your loans privately, you could miss out on those perks.

Consolidating your loans can also lead to longer repayment periods. Since the payable amount increases considerably, you may have to be tied down by the loan for much longer than you’d anticipated.

You Can Take Advantage Of The Grace Period
Depending on the type of loan, you can receive a grace period before you’re obligated to start your loan repayment. The first payment will jump-start the process, but it can be difficult to reach this milestone when you’ve recently graduated from college.

While some may struggle to find a job right after graduation, others may find it difficult to set aside an amount to start paying off their debt. In such circumstances, you can avail a grace period to get your bearings before you dive right into loan repayments.

Making up about 5% of all borrowers, these loans are temporarily put on hold as you sort out your life and finances outside the world of college.
Federal lenders often allow a six-month timeframe within which borrowers have to sort out their finances, while private lenders can decide their own terms. It’s important to contact your lender to find out exactly how much breathing room you have before the monthly loan payments begin.

Work Out Your Monthly Repayments



Working out a budget to account for your expenses is key to staying on track with your loan repayments. Factor in the monthly contribution to your debt repayment along with other monthly expenditures to ensure you don’t have to forego your contribution for the month. Just because the payments are divided into monthly contributions doesn’t mean you have to be limited by them. Faced with the prospect of having to repay loans anywhere between 10 to 30 years, many people prefer to speed the process along with larger payments when they can. Not only will this shorten your repayment term, but you’ll also save more on the interest you would have to pay for a longer-term loan.

Set up automatic payments
Once you establish your monthly contributions, you might want to consider signing up for auto-debit payments to your lender. Setting up for monthly payments will simplify the repayment process, make it impossible for you to miss a payment, and will keep your budget on track.
Additionally, many lenders offer an incentive to set up auto-pay: a reduction in interest rates. By opting for this service, you can enjoy a 0.25% decrease on all your loans.

Student loan relief comes in various forms and coupling student loan refinancing with auto-pay offers a smooth, hassle-free, and efficient means of paying off your student debt.

What Are Your Payment Options? Is Loan Refinancing A Good Choice?
Not all payment plans are created equal, that’s why you need to find one that works best for you. Before you make your first payment, it’s essential to understand each payment plan the type of loan has to offer since it has a considerable impact on your monthly payments, interest rates, and repayment schedule.

Regardless of your loan type, you can choose to refinance your student loans with Education Loan Finance to lower monthly contributions and potentially save thousands of dollars. This payment option is a viable choice for recent graduates looking to benefit from more favorable loan terms and enjoy the flexibility that comes with refinancing your student loans with a private lender.

Since federal and private loans offer different payment options, it’s necessary to consider their merits—and demerits—accordingly.


Private loans payments
Working with a private lender, you can enjoy greater control and flexibility in terms of loan repayment. Since the choice you make impacts the entire life span of your student loan, it’s imperative to weigh your options before jumping right in. Private lenders are set the terms and payment plans on their own discretion, which is why finding the right lender is so important. Some of the plans they offer are:

• Immediate repayment plan: You can make full monthly payments before your degree is even complete. This results in lower interest rates, greater time efficiency, and increased savings if you have the available finances to delve into this plan.
• Interest-only repayment plan: With this plan, you can start paying off the interest on your loan while you’re still in college. Making payments more manageable each month, this plan allows you to stop the loan balance from accruing before you graduate.
• Partial interest repayment: If you’re unable to make the complete interest payments while still in college, you can keep your loan balance in check by paying a fixed amount every month to cover part of the interest you owe to the lender.
• Full deferment: With this option, you’re not obliged to start repaying your loan while you’re still in college. You can defer your repayment worries until after you graduate and settle down in your career.



Federal loan payments
One perk of obtaining federal loans is that there are various repayment plans for you to choose from. Depending on your current financial capability, you can select a plan that seems to offer you favorable terms, lower monthly payments, and an efficient payment process.
• Standard payment plan: With fixed monthly payments over a 10-year period, this standard plan is ideal for someone looking to pay off their debt within a short repayment schedule.
• Graduated repayment plan: This plan is ideal for graduates looking to repay their loans soon, offering lower initial payments that gradually increase every two years.
• Extended repayment plan: For someone looking to make smaller monthly contributions over a longer time, this plan extends the repayment period to 25 years.
Other federal loan payment plans include options dependent on your income or give you the ability to repay as you earn.


A Final Word
Graduating from the college of your dreams with a degree you’re passionate about is a milestone in itself, but starting to pay off your student debt is a feat worth appreciating. Before you begin your loan repayment, there’s a lot to consider in order to ensure you’re making the right choices that’ll benefit you in the long run.

About the Author
Committed to assisting college hopefuls in achieving their dreams, the author has helped countless students and their parents with tailor-made financial solutions. From borrowing and lending to student loan refinancing, their passion and extensive experience with financial advisory help them understand just how much a good college experience is worth.