Student Loan | Student Loan Repayment
January 28, 2012 – 1:14 am
Lenders provide a diversity of plans to pay back your student loans — some quite flexible. These plans obtainable to you depend upon the kinds of loans that you have. You should find out what type of loans you have, know about your options, and make the good choice for your fiscal case.
Various rules apply to private and federal Student Loans. Loans awarded by banks and the federal government are of 2 kinds — both let you select from the provided repayment plans.
1. FFEL (Federal Family Education Loans) are the loans designed by the private lenders guaranteed by the government. It means that in case you default, your lender gets reimbursed by the government.
2. Federal Direct Loans are designed directly by the government.
School-issued loans. When you have a school-issued student loan (for instance, a Perkins loan), you should ask your college about the repayment options.
Private loans. These loans, made with no federal finances, come with only fewer repayment options. You need to contact the lender, loan servicer or loan holder to know your repayment opportunities.
Hints on switching plans. Bear these in mind while considering your repayment plans:
1. You should not wait to switch the payment plans until you are behind in the payments — in case you are in default on the loans, many of the provided options will not be accessible to you.
2. You are not locked into the way you choose — you are able to switch the payment plans annually, or in certain cases, more often.
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Tags: Banks, repayment plans, student loans
