College Student Loans
So you've graduated school and are having difficulty paying your college student loans on time. The best thing you can do at this time is to contact the lender directly and explain the situation; if you're finances get worse, they will be more likely to work with you if you proactively warn them about it. Here are a few ways you can deal with federal student loan debts.
You can ask the lender to defer payments temporarily (three years max). Most people will qualify for a deferment if they are unemployed, in the military or currently in school for another degree. Depending upon the loan, interest may accrue during this period. Check with your lender before signing the contract! Learn more by visiting http://studentaid.ed.gov/PORTALSWebApp/students/english/repaying.jsp.
If a deferment is out of the question (or is denied) you can ask for a forebearance, which reduces your monthly payment temporarily or postpones them. People who qualify for forebearance are either in poor medical health, work as an intern or can prove financial hardship.
Bankruptcy does not work with student loan debt. If you file a Chapter 7, you are required to continue payments; if you file Chapter 13, you must resume payments in three to five years. In other words, if student loans are your main debt, forget bankruptcy as a solution.
Additional Ways To Pay College Student Loans
Better solutions include working with a debt consolidator to lower all your loans (assuming you have several). Consolidating student loans may lower your monthly payment and your interest rate; a smart financial move across the board. By having one loan only, it is easier to pay back each month, as you are less likely to forget one.
Finally, you can cancel your student loans, provided you have a very, very good reason to do so. For example, if you have become disabled, your school shuts down, or you are a teacher in a low-income neighborhood.
Look into these options to help deal with federal student loans and debt. For more information, check out these student loan repayment options.
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