You don't have to be afraid of borrowing a student loan, you just need to fully understand how they work!
Learn to manage your student loan debt because borrowing for your education carries serious responsibilities. Many students use federal loans to help finance their studies and some choose private loans. Taking out a loan is an important financial decision that can affect you for years to come. It is critical for you to understand your loan options in order to make good borrowing decisions.
One major financial goal should be to finish college owing as little money as possible. A college education increases your earning potential and opens doors of opportunity. Know that you must repay your student loans, even if you:
Your student loan payments will depend on the interest rate, the amount you borrow and the payment plan you choose. Here is what payments on Federal Student loans (the most common types of loan) look like.
If you take out private loans, interest rates may be fixed to variable (meaning they can change at any time). Taking out a loan is a huge responsibility, don't take it lightly!
There are many repayment options for federal subsidized and unsubsidized loans. Payments generally begin 6 months after you are no longer enrolled at least ½ time (9 months for Perkins Loans). Payment options include:
The best place to find your complete loan history of federal loans borrowed is at the National Student Loan Data System (NSLDS) website. In addition to loan history, contact information is provided for the servicer that holds your loan. Please note that any private loans you borrowed will not be listed.
A Direct Consolidation Loan allows you to consolidate (combine) multiple federal education loans into one loan. The result is a single monthly payment instead of multiple payments. Find out more about consolidation. Please note that consolidation may change the interest rate and benefits of your loans.