- Personal Finance»
- Paying for College
Destination Student Loan
It's payback time... no where to run!
Student loans are the destination for just about every college student out there. Maybe you graduated, maybe you didn’t. But if you filled out the loan paperwork, you are probably working to pay off your student loans… for a long time.
Yes, there might be some who are lucky enough to have their college paid in full, without ever having to take out a loan. Those fortunate souls are far and few between. The other ones who don’t have student loans are probably the ones who didn’t attend college at all. The remainder of the people with a student loan, will have to pay them off, starting 6 months after graduation.
The irony of a student loan is it is needed to pay for college; college is needed to get a high paying job; yet, with a high paying job, you are stuck paying a loan for a minimum of 10 years (unless you get a forbearance, which will extend the time you pay on it.)
Take control of your student loans
No Where to Run
The student loan is also something you can not run away from. Because the student loan is federally funded, you will find it difficult to file bankruptcy on the loan and have it dismissed. According to Student Loan Brorrower Assitance, " to discharge in bankruptcy... you must show that payment of the debt will impose an undue hardship on you and your dependents.” If you can prove this hardship, your student loans may be completely discharged, however, it will depend on the judge overseeing your case. Not all judges will be as leniant to discharging student loans.
If discharging student loans is not an available option for you due to financial problems, filing for a forbearance is always an option. However, the loan will eventually need to be paid back. A forebearance will allow extra time before the student loan has to be paid back. However, if your loan has been approved for a forebearance, you will still be charged interest on the loan. A forebearance is not the same as a loan deferment, as in the interest on subsidized loans will not be accrued while the loan has been deferred.
Financial instituations are usually more than willing to work with you to help pay off student loans. After all, defaulting on a loan isn't beneficial for either party. If you are not able to defer or obtain a forebearance on the student loan, you may also request a change of repayment plan to make your loans more affordable. Just remember, if you default on the loan, you will also be ineligible for future student loans.
There are other consequences to not paying back your student loans. If you choose to not pay back your loans, this may also adversly effect your credit and credit score. That being said, trying to get anything else on credit may prove to be difficult or nearly impossible. In addition, you may also lose any tax refunds in the future to pay back your student loans and your job wages could be garnished, according to Student Loan Default in the United States, on Wikipedia.
Further Reading Recommendations
Clickity Clack Ads - If you want to make money online, here is the secret to earning with Google Adsense.
So You Think You Can Save - Learning to spend money at the right time; on the right things can make a difference in how much income you actually have at the end of the month.
Money Doesn't Grow on Trees - Unless you plant your own - Do you want to know how to make your own money tree? Change your habits and read this article.
How to Get a Student Loan Without a Cosigner - If you want to head to school, this is the lowdown on federal aid that can be obtained without a cosigner.
Help Paying off Student Loans - Tips and Tricks - If you have already completed your school and have the daunting debt hanging over your head, here is some tips and tricks to help get those loans paid off.
Is the Student Loans Worth It?
Is the student loan worth it? This maybe questionable to some as they feel they can get by without college or they just don't feel like being financially responsible for the money due to lender. However, what it comes down to... is in the economic crisis, it having a student loan to get you through college worth the money you will have to pay back in the future?
Absolutely! In order to secure yourself a good job were you can advance in today’s society you need an education. With unemployment rates at an all time high, having a degree is almost a necessity to secure yourself any job. However, if you don't pay back your loans and your not one of the lucky ones to go to college and have it paid off immediately, repercussions to not being responsible could haunt you for the rest of your life!
While your taking courses, it is also a wise idea to go ahead and take a finance course as one of your electives. It will definitely give you a step up on controlling your finances well into your adult life. But, if you don’t plan on paying your loans back, then you might as well skip the college life. While student loans may initially help you out, they can hurt you if you decide to not do the right thing and pay them back.