Important Things Every Student Must Know About Student Loans and Obama Loan Forgiveness For students who are in the verge of graduating, May is a very important month. Apart from your final exams, and the dream job you’ve been wanting all throughout your life, it is also important to think about your student loans. Expect […]
Important Things Every Student Must Know About Student Loans and Obama Loan Forgiveness
For students who are in the verge of graduating, May is a very important month. Apart from your final exams, and the dream job you’ve been wanting all throughout your life, it is also important to think about your student loans. Expect that after graduation, you’ll need to have cash to cover the costs of repaying your student loans. If you only have one student loan, then that would be much easier, but in reality, you have multiple loans, so repaying it will be much difficult. It can be confusing dealing with various agencies and you might not be fully aware of the amount you owe and when you need to process a payment. The good new is that repayments can be simplified with a small dose of organization, and all you need to do is to get the necessary information so you can write it down or just create a direct debit account so the payment will just be automatically taken out.
One way to help new graduates in reducing their loans is by taking advantage of Obama Student Loan Forgiveness or Federal Direct Loan Program. It is a program of the government to help students repay their student loans in a smoother and easier terms that apply to all federal student loans but not to private loans. There are a lot of benefits a borrower can get by taking advantage of Obama Student loan Forgiveness such as the ability of consolidating all federal student loans into just a single new loan, and the consolidated loan can be repaid using a preferred repayment plan which is more affordable. The different repayment plans under the Obama Student Loan Forgiveness Program includes standard repayment, graduated repayment, income contingent, income based, and pay as you earn. Standard repayment refers to the processing of a payment with fixed amount in the entire duration of the loan as determined by the interest rate, amount of the loan and its terms. For a graduated repayment, the borrower can make lower payments as compared to standard repayment plan but the amount gradually increases every two years. With income contingent repayment plan, a borrower can make payments depending on his income, loan balance, family size, and interest rate. For income-based repayments, the amount of loan balance and interest rate are not considered, but rather strictly the income and family size or 15% of their discretionary income. PAYE or Pay as You Earn repayment has the lowest monthly payment basing on the borrower’s income or ten percent of the discretionary income.
As a student loan borrower, finding out your loan’s grace period is also important. It ranges from six to nine months and it depends on the type of your loan. This will give you sufficient time to find money to pay your loan. You really don’t have to stick with traditional or standard repayments because there are many options for you, just research more by viewing our website.