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Discover Your Student Loan Repayment Options

Discover Your Student Loan Repayment Options
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If you graduated from college in May of this year and have a feeling of foreboding overwhelming you, it might not just be Halloween that has you spooked. That gnawing pain in your stomach might be due to the fact that the grace period on your student loans is about to expire, and soon you will have to begin making payments. Do you already know how much you will have to pay each month? How does it compare to the amount of money you are currently earning? If you don’t know the answers to these questions, here are a few tips from Discover Student Loans on what to do before you dive into repayment:

• Draw Up a Monthly Budget: The first thing you will need to know is how much money you have available to make your student loan payments. You might need to ask your parents or an older relative to help you with this, but basically you need to add up how much money you earn every month. Now list out your monthly expenses, and subtract that from your income. The remaining amount is what you have to work with to make your student loan payments.

• Calculate Your Monthly Student Loan Payments: If you are not eligible for some type of loan deferral, you should already have a list of your outstanding student loans. Now you have to determine the monthly payments for each. For federal student loans, you can use the FSA Repayment Estimator to estimate your monthly loan payments and evaluate repayment plan options. Most private student loan lenders, like Discover Student Loans, will also have some type of monthly payment calculator. Add up your monthly payments and compare it to the amount you have available in your budget. If your loans exceed your income, you will either need to increase your income in some way or consider some type of alternative repayment plan.

• Find a Loan Repayment Program: If your income is lower than your payments, there are several loan repayment programs which could help you, based on your lender and your individual financial situation. For federal student loans, you need to contact your loan servicer if you want to discuss options such as an income-based repayment plan. You can find out who your loan servicer is by logging in to My Federal Student Aid. If you would like to apply for a Direct Consolidation Loan for your federal student loans, you will need to visit

For private student loans, you will need to contact each lender directly as individual repayment options may vary. Discover Student Loans, for example, offers several Repayment Assistance Options such as deferment, grace extension, payment extension, reduced payment, forbearance and hardship. Be prepared to offer documentation for any statements you make about your income or expenses. Many lenders are willing to work with you, but it is better to be proactive and not wait until the bills come in before you take action.

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