Student Loan Info:Top 3 Ways To Reduce Student Loan Debt
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There are some simple ways to reduce student loan debt. Follow this easy guide and you can easily reduce the amount of your debt.
One- Check In To Forgiveness Programs
The best way to reduce student loan debt is to have the loans forgiven. If you work in a volunteer industry (such as the Peace Corps or VISTA) you can qualify to have as much as 70% of your loans forgiven. If you work in the medical field and are willing to relocate to an economically depressed area you may qualify for repayment of the loans through various organizations. The same options are available for public servants, legal aid law workers, and various government workers. Check to see if you qualify for any of these programs and you can enjoy fulfilling work and a reduction in your loan amounts.
Two- Understand Interest Rates
Another way to reduce student loan debt is to completely understand the loan. Most student loans will have a set rate, that is only variable if Congress changes the rate. They are typically fixed and not determined by Prime rate. This means that your rate should stay low. Every July Congress will set the cap on the interest rate that can be charged to student loans. During this time it’s in your best interest to call your loan provider and see if the rate is negotiable. Even if you can get the rate lowered by a small amount it will serve you greatly in the long run. You also want to be sure you understand what circumstances will increase your rate, as this could cost you quite a bit of money over the course of the loan.
Three- Payments
It is vital in reducing student loan debt to ensure your payments are timely. A missed payment, or a payment made just a few days late can cost you several percentage points on your interest rate, not to mention a late payment fee added to your loan. The nasty thing about these interest jumps is that you don’t pay the penalty for just the one payment you missed or made late, but for every payment thereafter until you can lower the rate again. This can potentially add thousands of dollars to your loan. If your lender has programs like direct debit available, by all means take advantage of this! Having your payments made automatically every month will save you this hassle.