A lot of people are having debt problems these days, and
the problem does not just affect lower income people. In
some areas, home foreclosures are occurring at an
unprecedented rate, and people who have always had
excellent credit now find themselves unable to keep up the
payments on all the debt they have incurred.
Although debt problems are complex and can take many
different forms, many people find themselves in trouble
from irresponsible use of credit cards. Lenders bombard
consumers on a daily basis, whether on tv, through the
mail, or by email with "special offers" for people opening
a new account. Then, they offer incentive programs to
reward those who spend a certain amount of money with their
credit card or line of credit.
Some debt problems are simply unavoidable. Cars break
down, major appliances fail, and home repairs must be done.
Debt, especially with higher interest credit cards, can
add up quickly. If your debt grows to the point that you
can only afford to make the minimum monthly payments, you
will almost certainly find yourself in financial trouble.
Before late payments cause you to fear answering your
phone, you should explore debt consolidation.
Debt consolidation involves paying off multiple debts and
consolidating them into one larger loan. Ideally you will
want to get a lower interest rate on the consolidation loan
than on your current debt, but even if you cannot, the
payoff time on the debt consolidation loan will normally be
longer than the time left on your current debts, so you
will still be able to lower your monthly payments
considerably.
The good news is that even with poor credit you may still
qualify for a debt consolidation loan. You will pay a
higher interest rate than would someone with immaculate
credit, but if you are consolidating high interest debts,
the interest rate on your new loan will probably be lower
anyway.
If you happen to own a home, you have another form of debt
consolidation available to you. Leveraging the equity in
your home is excellent way to consolidate your debts and
get a lower interest rate if your credit is less than
perfect. You can choose to refinance your mortgage or
apply for a home equity loan. The catch is that if you
fail to make timely payments on your loan you will be at
risk of losing your home to foreclosure.
An alternative to a debt consolidation loan is to contact
your individual creditors and explain that you are having
difficulty making your payments. More often than not they
will be willing to work with you and help work out a
payment plan that you can afford. Lenders would prefer to
accommodate customers who are sincerely interested in
repaying their debt, than having to resort to costly
collection fees and possible legal action.
If contacting your creditors is disagreeable to you, many
reputable credit counseling firms will be glad to take over
this task for a fee. They are professionals who deal with
creditors every day, and they are often capable of getting
the interest rate reduced, or the interest on the debt
completely eliminated. Be sure to check the company's
reliability report with the Better Business Bureau.
It is better to deal with debt problems in the early
stages, before your credit has been damaged, or worse, you
face bankruptcy. Debt consolidation is a practical way to
simplify debt repayment, save money, and prevent financial
disaster.
----------------------------------------------------
Gregg Pennington writes articles on a number of topics
including loans, debt and credit. For more information
about debt help and credit repair visit:
http://www.onlinemoneysources.net/debt-and-credit.html
Thursday, September 13, 2007
Friday, August 17, 2007
Seven Steps to Changing How You Think About Debt (So You Can Get Out of Debt Quicker)
Getting out of debt does not happen accidentally. Well,
even if it does happen accidentally (like a person winning
the lottery) debt problems are rarely solved unless and
until the person with the debt starts to think about the
debt in a different way.
First, you have to admit you have a debt. Believe it or
not, this a stumbling block to many people who prefer to
live in denial (it's cheaper) than debt. But denial will
eventually crack under your feet and plunge you into the
icy waters of reality. Size up your debt.
How do you do that? Take a pencil and paper and start to
write down all of your debt. You may have to call the
toll-free numbers on your various credit cards and look up
phone numbers on varies statements. Write down all of your
debts and add them together.
Don't look away, even if the number is scary. You need to
know the truth. Sometimes it takes a scary number to get
our full attention!
Second, you have to "own" your debt. A lot of people act
like their debt belongs to someone else. And maybe it did,
in a way! Some people come into overwhelming debt because
they wound up with the debts of a spouse (or ex-spouse).
Some people end up paying off the debts of family members.
Others got into debt when a house burned down or the family
suffered a medical problem. You might get into debt over
posting bond for a loved one.
No matter how you wound up with the debt, you have to
recognize it as your own. You have to take responsibility
for it.
There are lots of reasons that people get into debt. Even
if you just overspent your way into debt, you probably had
a lot of good reasons for what you did. Maybe you had a lot
of debt left over from your college days. Maybe you were
under a lot of emotional stress and found "retail therapy"
helped. Maybe you just did not understand money. I know a
woman who wound up paying off a lot of debt she got herself
into while in the "manic" phase of undiagnosed
manic-depressive illness.
You may have reasons, and that's not the point. The point
is: the debts are yours. Take responsibility for them.
You won't ever get out of debt till you admit that you (not
anybody else) have debt.
Third, you need to forgive your creditors. That sounds very
weird, but have you ever noticed that in the Bible, it
talks a lot about "sin" and "debt" being related? The
Lord's prayer, for instance, in some Bible translations
talks about asking God to "forgive us our debts as we
forgive our debtors." In financial terms, overlooking a
debt means to "forgive" it.
You probably got into financial trouble because of some
other trouble. Whether it was a failed marriage, a natural
disaster, disease, devastation, mental illness, or just
plain getting through a "rough patch," you probably need to
go back and forgive the other people involved.
Let's say you're heavily in debt because you owe child
support. And let's say that there is a lot of pain still
attached to the relationship that brought that child into
the world. Maybe you even feel tricked or cheated into
paying the child support. And it could be genuinely unfair.
Forgive everybody involved. Forgive the other parent of
your child, forgive your child, forgive the family of the
other parent, forgive the state, and forgive the judge who
made the ruling.
Forgiveness does not mean that you agree that what they did
was right. Forgiveness does not mean you like what was done
or that you approve of what was done. Forgiveness means you
accept it and you refuse to carry around that wasteful
anger and animosity any more.
What happened may or may not have been fair, but that's not
the point. It's happened and you are ready to get past it.
That's forgiveness.
Fourth, you need to make a conscious choice to get out of
debt. A lot of people are digging themselves deeper and
deeper into debt not because they want to, they just have
not decided to stop digging! Make a decision.
Getting of debt involves one big decision (that's the easy
part) and hundreds of smaller, daily decisions (that's the
tough part). If you need to, find a way to remind yourself
of getting debt free. Maybe you can write it on a paper and
stick it on your desk, in the car, or on your bathroom
mirror. You can make up a mantra for yourself and just say,
"I'm going to get out of debt" whenever you need to and
even some times when you don't need to. Don't buy anything
new, but if you have a ring or bracelet or something
special, you can wear that and use it to remind yourself
that it is the symbol of your decision to get over your
debt.
Fifth, stop the bleeding. Most debt is a result of a lot of
small wounds. Stop as many as you can. This means you have
to look for them. A few debt areas will be obvious. Do what
you can to stop digging yourself into debt. But search out
other ways that money is slipping through your fingers.
Don't be afraid to be zealous. Zealous, passionate people
are the ones who can beat debt. Quit the gym, don't eat out
so much, cancel cable TV, start shopping the garage sale
circuit. Many of us get riled up at some of those
prospects, but they are all viable strategies. They work.
I'm not saying you have to do all of them or any of them
but you need to stop as much hemorrhaging as possible.
Sixth, get a plan. It does not seem to be as important to
use a specific plan as it is to use any plan. You need a
system. One good one is to line up your debts and start
paying them off. Pick your highest interest debt first and
devote every spare cent to paying it off. Then proceed from
there.
You can also try debt consolidation where you roll a lot of
higher-interest debt together into one larger debt at more
favorable terms.
Certified credit counselors are available locally (check
out http://www.nfcc.org) or online. There are valuable
books and courses on money management. Figure it out, get
help, or work with somebody. But you need a game plan.
Seventh, keep on. Getting out of debt is a bit like losing
weight: it takes hard work, dedication, and just dogged
day-after-day persistence.
----------------------------------------------------
If you or a loved one are facing overwhelming debt, get
information on debt consolidation at
http://www.debt-consolidation-diva.com .
even if it does happen accidentally (like a person winning
the lottery) debt problems are rarely solved unless and
until the person with the debt starts to think about the
debt in a different way.
First, you have to admit you have a debt. Believe it or
not, this a stumbling block to many people who prefer to
live in denial (it's cheaper) than debt. But denial will
eventually crack under your feet and plunge you into the
icy waters of reality. Size up your debt.
How do you do that? Take a pencil and paper and start to
write down all of your debt. You may have to call the
toll-free numbers on your various credit cards and look up
phone numbers on varies statements. Write down all of your
debts and add them together.
Don't look away, even if the number is scary. You need to
know the truth. Sometimes it takes a scary number to get
our full attention!
Second, you have to "own" your debt. A lot of people act
like their debt belongs to someone else. And maybe it did,
in a way! Some people come into overwhelming debt because
they wound up with the debts of a spouse (or ex-spouse).
Some people end up paying off the debts of family members.
Others got into debt when a house burned down or the family
suffered a medical problem. You might get into debt over
posting bond for a loved one.
No matter how you wound up with the debt, you have to
recognize it as your own. You have to take responsibility
for it.
There are lots of reasons that people get into debt. Even
if you just overspent your way into debt, you probably had
a lot of good reasons for what you did. Maybe you had a lot
of debt left over from your college days. Maybe you were
under a lot of emotional stress and found "retail therapy"
helped. Maybe you just did not understand money. I know a
woman who wound up paying off a lot of debt she got herself
into while in the "manic" phase of undiagnosed
manic-depressive illness.
You may have reasons, and that's not the point. The point
is: the debts are yours. Take responsibility for them.
You won't ever get out of debt till you admit that you (not
anybody else) have debt.
Third, you need to forgive your creditors. That sounds very
weird, but have you ever noticed that in the Bible, it
talks a lot about "sin" and "debt" being related? The
Lord's prayer, for instance, in some Bible translations
talks about asking God to "forgive us our debts as we
forgive our debtors." In financial terms, overlooking a
debt means to "forgive" it.
You probably got into financial trouble because of some
other trouble. Whether it was a failed marriage, a natural
disaster, disease, devastation, mental illness, or just
plain getting through a "rough patch," you probably need to
go back and forgive the other people involved.
Let's say you're heavily in debt because you owe child
support. And let's say that there is a lot of pain still
attached to the relationship that brought that child into
the world. Maybe you even feel tricked or cheated into
paying the child support. And it could be genuinely unfair.
Forgive everybody involved. Forgive the other parent of
your child, forgive your child, forgive the family of the
other parent, forgive the state, and forgive the judge who
made the ruling.
Forgiveness does not mean that you agree that what they did
was right. Forgiveness does not mean you like what was done
or that you approve of what was done. Forgiveness means you
accept it and you refuse to carry around that wasteful
anger and animosity any more.
What happened may or may not have been fair, but that's not
the point. It's happened and you are ready to get past it.
That's forgiveness.
Fourth, you need to make a conscious choice to get out of
debt. A lot of people are digging themselves deeper and
deeper into debt not because they want to, they just have
not decided to stop digging! Make a decision.
Getting of debt involves one big decision (that's the easy
part) and hundreds of smaller, daily decisions (that's the
tough part). If you need to, find a way to remind yourself
of getting debt free. Maybe you can write it on a paper and
stick it on your desk, in the car, or on your bathroom
mirror. You can make up a mantra for yourself and just say,
"I'm going to get out of debt" whenever you need to and
even some times when you don't need to. Don't buy anything
new, but if you have a ring or bracelet or something
special, you can wear that and use it to remind yourself
that it is the symbol of your decision to get over your
debt.
Fifth, stop the bleeding. Most debt is a result of a lot of
small wounds. Stop as many as you can. This means you have
to look for them. A few debt areas will be obvious. Do what
you can to stop digging yourself into debt. But search out
other ways that money is slipping through your fingers.
Don't be afraid to be zealous. Zealous, passionate people
are the ones who can beat debt. Quit the gym, don't eat out
so much, cancel cable TV, start shopping the garage sale
circuit. Many of us get riled up at some of those
prospects, but they are all viable strategies. They work.
I'm not saying you have to do all of them or any of them
but you need to stop as much hemorrhaging as possible.
Sixth, get a plan. It does not seem to be as important to
use a specific plan as it is to use any plan. You need a
system. One good one is to line up your debts and start
paying them off. Pick your highest interest debt first and
devote every spare cent to paying it off. Then proceed from
there.
You can also try debt consolidation where you roll a lot of
higher-interest debt together into one larger debt at more
favorable terms.
Certified credit counselors are available locally (check
out http://www.nfcc.org) or online. There are valuable
books and courses on money management. Figure it out, get
help, or work with somebody. But you need a game plan.
Seventh, keep on. Getting out of debt is a bit like losing
weight: it takes hard work, dedication, and just dogged
day-after-day persistence.
----------------------------------------------------
If you or a loved one are facing overwhelming debt, get
information on debt consolidation at
http://www.debt-consolidation-diva.com .
Wednesday, August 15, 2007
Student Loan Consolidation Programs And Repayment Tips
College education is important as it will path a way for a better career in future. However, with the rising cost in college education, taking a student loan is inevitable for certain students. Fortunately, there are student loan consolidation programs available which you can take to finance your studies. While taking student loan is a good move, it could be a double edge sword if you end up unable to repaying them, thus ended up deep in debt. This is most undesirable.
Taking a student loan is a commitment by itself. Before you take up any student loan, you got to discuss it with your parent at least. Collectively, draft out a feasible repayment plan that ever members agree and stick to the plan. In this way, you will be more motivated and committed to replay your student loan in good time
You can take reference from the below suggested pointers to do your planning. After all, you are going to college, right? Take this as your first research project, or if you like, a student loan thesis. If you have a plan, you are more likely to reply your student loan successfully.
The first point to take note is to do your own research. With the internet, you can search and compare so many student loan consolidation programs. Read and check each and every one of them thoroughly and carefully. Call or meet the agencies if need be. Be aware that not all student loan consolidation programs are equal. You should not short chain yourself but must take the effort to obtain the best deal.
The second point to take note is to keep in touch with your lender. The very basic thing that you need to do is to read every mail or email that they sent to you. You can get a surprise if they change certain terms and conditions which are not favorable to you or vice versa.
The third point to take note is to organized all your student loan documents and correspondences. As you progress through your studies and enjoy your campus life, you may just leave all your student loan documents and correspondences anywhere. If you do that, this is going to be a great mistake. All these documentations are important as it spells out your obligations. At the end of your college life, there is a possibility that you may have forgotten what are your obligations. You need to refer to them. Therefore, keep and organized them until you have repay your student loan completely.
The fourth point to take note is to attend all the required student loan counseling sessions. Usually, there are two sessions. The first session is often conducted when you first obtain the loan while the second one is conducted when you have graduated. Attending these sessions are beneficial as they will provide you with important information so that you can act in the most appropriate way.
The fifth point is to manage your expenses. In simple term, be thrifty. Spend only what is necessary. There is a Chinese proverb saying that, “Bitter first & Sweet Later”. This means that to work hard first and enjoy the fruits later. When you have the earning power later, you can then enjoy. Again, spend only what is necessary when in college.
The final point is to remind yourself of your obligations when you graduate. Take out all your student loan documents and read through your obligations. Also, take out the plan with you have drafted out together with your parents. Get a job and be ready to repay your student loan and be a responsible borrower.
Taking a student loan to finance your education is a good move. With so many student loan consolidation programs available, you are not shortage of it. However, you need to make a commitment to repay them when the time comes. The best way to fulfill your commitment is to have a solid and concrete repayment plan. Having your parents as your witnesses when you draft your repayment plan will certainly motivate you reply successfully. For more information, please visit Student Loan Consolidation Programs.
Williams Johnson involved in personal finance and home mortgage research. He likes to share tips and suggestions that can help people to manage their finance. For more helpful information, please visit: http://www.fibcool.com/student-loan/index.htm
Article Source: http://EzineArticles.com/?expert=Williams_Johnson
Taking a student loan is a commitment by itself. Before you take up any student loan, you got to discuss it with your parent at least. Collectively, draft out a feasible repayment plan that ever members agree and stick to the plan. In this way, you will be more motivated and committed to replay your student loan in good time
You can take reference from the below suggested pointers to do your planning. After all, you are going to college, right? Take this as your first research project, or if you like, a student loan thesis. If you have a plan, you are more likely to reply your student loan successfully.
The first point to take note is to do your own research. With the internet, you can search and compare so many student loan consolidation programs. Read and check each and every one of them thoroughly and carefully. Call or meet the agencies if need be. Be aware that not all student loan consolidation programs are equal. You should not short chain yourself but must take the effort to obtain the best deal.
The second point to take note is to keep in touch with your lender. The very basic thing that you need to do is to read every mail or email that they sent to you. You can get a surprise if they change certain terms and conditions which are not favorable to you or vice versa.
The third point to take note is to organized all your student loan documents and correspondences. As you progress through your studies and enjoy your campus life, you may just leave all your student loan documents and correspondences anywhere. If you do that, this is going to be a great mistake. All these documentations are important as it spells out your obligations. At the end of your college life, there is a possibility that you may have forgotten what are your obligations. You need to refer to them. Therefore, keep and organized them until you have repay your student loan completely.
The fourth point to take note is to attend all the required student loan counseling sessions. Usually, there are two sessions. The first session is often conducted when you first obtain the loan while the second one is conducted when you have graduated. Attending these sessions are beneficial as they will provide you with important information so that you can act in the most appropriate way.
The fifth point is to manage your expenses. In simple term, be thrifty. Spend only what is necessary. There is a Chinese proverb saying that, “Bitter first & Sweet Later”. This means that to work hard first and enjoy the fruits later. When you have the earning power later, you can then enjoy. Again, spend only what is necessary when in college.
The final point is to remind yourself of your obligations when you graduate. Take out all your student loan documents and read through your obligations. Also, take out the plan with you have drafted out together with your parents. Get a job and be ready to repay your student loan and be a responsible borrower.
Taking a student loan to finance your education is a good move. With so many student loan consolidation programs available, you are not shortage of it. However, you need to make a commitment to repay them when the time comes. The best way to fulfill your commitment is to have a solid and concrete repayment plan. Having your parents as your witnesses when you draft your repayment plan will certainly motivate you reply successfully. For more information, please visit Student Loan Consolidation Programs.
Williams Johnson involved in personal finance and home mortgage research. He likes to share tips and suggestions that can help people to manage their finance. For more helpful information, please visit: http://www.fibcool.com/student-loan/index.htm
Article Source: http://EzineArticles.com/?expert=Williams_Johnson
Sunday, July 22, 2007
Student Loan Debt Consolidation - Way To Financial Well Being
By Ashwell M
If you are a recent graduate who has taken a great deal of student loans, then student loan debt consolidation will help you out in bringing your student loans under control. With so much loan balance left, you might be crumbling under the pressure to meet all the expenses as well as pay-off the monthly amount for loans. The student debt consolidation loans are meant to consolidate all your outstanding loans into one loan which is available at better interest rates, lower monthly installments and larger tenure to repay.
Why Undergo Student Loan Debt Consolidation?
The most important benefit you will get from students loan consolidation is that you will get the new loan at a lower interest rate. Thus, you save on the interest you are paying off. As a rule the interest rates of student loan debt consolidation programs is less than the average of the multiple loans you are currently paying off.
One of the significant benefits is that you will be relieved of recurring late fees and other charges when you default one of your loans. If you have stacked up a number of student loans, it is difficult and very confusing to keep track of the various payment amounts and schedules, thus resulting in late payment or defaults from your side. By opting for the student loan debt consolidation, you will get rid of the burden of paying late fees and other incidental charges.
Another benefit is the type of repayment plans available and the loan tenure. The student debt consolidation loans are offered at longer loan tenures starting from the standard 10 years extending up to 30 years. In addition, various payment plans are available.
# The standard plan
# The graduated plan where you increase your monthly payments gradually
# The variable plan where the monthly payment is adjusted as per your earnings at that time,
# The flexible plan where the payment is taken care of if you are unable to repay or are going through some financial difficulties.
Thus, the repayment plan can be chosen based on your requirements. There are no pre-payment penalties on these loans under student loan debt consolidation.
A number of different financial institutions offer the student loans consolidation programs nowadays. Apart from companies specializing in student loan debt consolidation, the traditional lenders like banks are also offering such services to students.
Take your time to shop around for lowest interest rates, terms and conditions suitable for your needs and a company which is genuinely interested in helping you out before taking a plunge into the student loan debt consolidation programs. The student loans consolidation is a great way to manage your debts early in your career to gain control over your financial well-being.
If a student is deep in debt with student loans from multiple lenders, he/she must consider student loan debt consolidation. Student loans consolidation will help them out with the management of their various loans by combining all loans at much lower interest rates. Student Debt Consolidation Loans provides more options about student debt consolidation programs and ways to get rid of student debt with the help of federal loan consolidation.
Article Source: http://EzineArticles.com/?expert=Ashwell_M
If you are a recent graduate who has taken a great deal of student loans, then student loan debt consolidation will help you out in bringing your student loans under control. With so much loan balance left, you might be crumbling under the pressure to meet all the expenses as well as pay-off the monthly amount for loans. The student debt consolidation loans are meant to consolidate all your outstanding loans into one loan which is available at better interest rates, lower monthly installments and larger tenure to repay.
Why Undergo Student Loan Debt Consolidation?
The most important benefit you will get from students loan consolidation is that you will get the new loan at a lower interest rate. Thus, you save on the interest you are paying off. As a rule the interest rates of student loan debt consolidation programs is less than the average of the multiple loans you are currently paying off.
One of the significant benefits is that you will be relieved of recurring late fees and other charges when you default one of your loans. If you have stacked up a number of student loans, it is difficult and very confusing to keep track of the various payment amounts and schedules, thus resulting in late payment or defaults from your side. By opting for the student loan debt consolidation, you will get rid of the burden of paying late fees and other incidental charges.
Another benefit is the type of repayment plans available and the loan tenure. The student debt consolidation loans are offered at longer loan tenures starting from the standard 10 years extending up to 30 years. In addition, various payment plans are available.
# The standard plan
# The graduated plan where you increase your monthly payments gradually
# The variable plan where the monthly payment is adjusted as per your earnings at that time,
# The flexible plan where the payment is taken care of if you are unable to repay or are going through some financial difficulties.
Thus, the repayment plan can be chosen based on your requirements. There are no pre-payment penalties on these loans under student loan debt consolidation.
A number of different financial institutions offer the student loans consolidation programs nowadays. Apart from companies specializing in student loan debt consolidation, the traditional lenders like banks are also offering such services to students.
Take your time to shop around for lowest interest rates, terms and conditions suitable for your needs and a company which is genuinely interested in helping you out before taking a plunge into the student loan debt consolidation programs. The student loans consolidation is a great way to manage your debts early in your career to gain control over your financial well-being.
If a student is deep in debt with student loans from multiple lenders, he/she must consider student loan debt consolidation. Student loans consolidation will help them out with the management of their various loans by combining all loans at much lower interest rates. Student Debt Consolidation Loans provides more options about student debt consolidation programs and ways to get rid of student debt with the help of federal loan consolidation.
Article Source: http://EzineArticles.com/?expert=Ashwell_M
Student Loan Consolidation - The Long and Short of Consolidation Plans
By Peter Livingston
With tuition increasing at a rate greater than the cost of living, college students are depending more and more on student loans to help with the costs of higher education. Over the course of four or five years or longer in the case of graduate students, this adds up to many loans. Whether the loans are from the same lender or program or from different lenders and programs, most student loans can be consolidated under the Federal Direct Consolidation Loan. Consolidating your student loans can occur at any time after you take out your first student loan. The benefits, at least at the moment, are that you only pay one lender and there are several repayment plans to accommodate your financial situation.
Federal Student Loan Consolidation Plans
There are 4 consolidation loan repayment plans with fixed interest rates to choose from:
* Standard Repayment Plan:
The Standard repayment plan takes the shortest amount of time to repay. The interest is fixed and the monthly payments are fixed at a minimum of $50 for a maximum of 10 years.
* Extended Repayment Plan:
Under this plan the borrower pays fixed monthly payments that are less than the Standard plan. The repayment period can range anywhere from 12 to 30 years depending on the total amount borrowed. While the monthly payments are less, the total amount repaid is greater than the Standard plan because more interest accrues.
* Graduated Repayment Plan:
Another option that might work well for those who expect their income to increase gradually over time is the Graduated Repayment Plan. Rather than a fixed monthly payment for the duration of repayment, monthly payments increase every two years. Similar to the Extended plan, the repayment period varies from 12 to 30 years depending on the total amount borrowed
* Income Contingent Repayment Plan (ICR):
The Income Contingent Plan is more flexible than the other 3 plans because it considers the borrower's adjusted gross income, family size and the total amount borrowed when calculating monthly payments. The repayment period is a maximum of 25 years. Any unpaid portion of the loan at that time is discharged, but taxes must be paid on the discharged amount.
When choosing a plan, consider your financial situation and what it might look like in the future. Paying off your student loans sooner may be the best option for you, but you may have other financial considerations to make and need to keep more of your hard earned money for your current living expenses. Whatever the case may be, look at each plan carefully and consider how it will affect you now and in the future.
For more college scholarships and college funding information and resources, go to college scholarships">College Scholarship Information and Resources - CollegeMoneyUnlimited.com
The author of this article runs CollegeMoneyUnlimited.com, a college scholarship and funding resource site.
Article Source: http://EzineArticles.com/?expert=Peter_Livingston
With tuition increasing at a rate greater than the cost of living, college students are depending more and more on student loans to help with the costs of higher education. Over the course of four or five years or longer in the case of graduate students, this adds up to many loans. Whether the loans are from the same lender or program or from different lenders and programs, most student loans can be consolidated under the Federal Direct Consolidation Loan. Consolidating your student loans can occur at any time after you take out your first student loan. The benefits, at least at the moment, are that you only pay one lender and there are several repayment plans to accommodate your financial situation.
Federal Student Loan Consolidation Plans
There are 4 consolidation loan repayment plans with fixed interest rates to choose from:
* Standard Repayment Plan:
The Standard repayment plan takes the shortest amount of time to repay. The interest is fixed and the monthly payments are fixed at a minimum of $50 for a maximum of 10 years.
* Extended Repayment Plan:
Under this plan the borrower pays fixed monthly payments that are less than the Standard plan. The repayment period can range anywhere from 12 to 30 years depending on the total amount borrowed. While the monthly payments are less, the total amount repaid is greater than the Standard plan because more interest accrues.
* Graduated Repayment Plan:
Another option that might work well for those who expect their income to increase gradually over time is the Graduated Repayment Plan. Rather than a fixed monthly payment for the duration of repayment, monthly payments increase every two years. Similar to the Extended plan, the repayment period varies from 12 to 30 years depending on the total amount borrowed
* Income Contingent Repayment Plan (ICR):
The Income Contingent Plan is more flexible than the other 3 plans because it considers the borrower's adjusted gross income, family size and the total amount borrowed when calculating monthly payments. The repayment period is a maximum of 25 years. Any unpaid portion of the loan at that time is discharged, but taxes must be paid on the discharged amount.
When choosing a plan, consider your financial situation and what it might look like in the future. Paying off your student loans sooner may be the best option for you, but you may have other financial considerations to make and need to keep more of your hard earned money for your current living expenses. Whatever the case may be, look at each plan carefully and consider how it will affect you now and in the future.
For more college scholarships and college funding information and resources, go to college scholarships">College Scholarship Information and Resources - CollegeMoneyUnlimited.com
The author of this article runs CollegeMoneyUnlimited.com, a college scholarship and funding resource site.
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