Let’s be honest: in the summertime, no one wants to be reading up about interest rates or student loan options. But as parents of college students, we also all know that time flies by quickly. Pushing off research on loan options may seem like the best option while relaxing by the pool, but come the fall, that decision could prove to be costly for you and your family. If you put off researching student loan options, you might be losing out on thousands of dollars in the long run because of rushed decisions later on. Summer is actually the best time to research student loan options – there’s no pressure or looming deadlines to meet.
The reality is that failing to learn about payment options can place a graduate into a loan program that causes financial hardship, and could even lead to missed payments and extra fees. All of this could be avoided by doing some basic research in advance.
There’s two main groups of people who should take the time to research student loan options:
Families currently borrowing for college:
The best way to avoid problems down the road is to get the best possible student loan in the first place. To find the perfect loan, you and your student need to do some quality research on options available. The first place to seek information for the student and the parents is federal student loans. They usually offer the best interest rates and repayment terms. Some options, such as subsidized interest during the college years, are particularly helpful to families. To qualify for these loans, though, you must complete the FAFSA, even if you think you won’t qualify for any other type of assistance. After exhausting the federal student loan options, then carefully study private student loan offerings to make sure you find the best options for your family. Remember, no matter if you think you qualify for money or not, fill out the FAFSA in the fall.
Graduates with student loan payments ahead:
Now that graduation has passed, you’re almost to the point that it will be too late to think about repayment options. Bills start arriving in just a few months! The summer is the best time to look at your income potential and the amount of debt you’ve accrued to this point. If you’re not earning enough money to make your monthly payments, then you have some work to do. Reach out to your loan provider and discuss your options, including extended term or income-based repayment. This paperwork can take some time to process, so now is the best time to do your research and complete whatever your loan office needs.
While it’s tempting to blow off thoughts of interest rates and repayment options, summer is the best time to research your student loan options. Get ahead of the student loan clock and do your research now. You’ll thank yourself later!
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CFAA helps with the financial aid process, from completing the FAFSA and completing the CSS Profile to reviewing the SAR, responding to requests for verification, comparing financial aid offers and understanding student loan options. Schedule a 15 Minute Power Chat to learn more about finding ways to pay for college.