Student Loan

Over the past 15 years, more and more students have had to resort to obtaining student loans in order to finish their education. The fact is far too many students are graduating and finding themselves in extreme debt. When it comes time for the repayment process to begin (usually six months after graduation), many of these former students feel overwhelmed. However, there are several things these new debtors can do make the process a little less painful.

1. Not Yet Employed – Most student loan programs include a provision for individuals who have not yet entered the job market. If the debtor has not yet secured employment, they need to contact the lender and request a delay in the beginning of the repayment process. The provisions for this can usually be found in the loan company's “forbearance policies”.

2. Debt Forgiveness – Some companies will offer to pay off the individual's student loans in exchange for meeting certain criteria in the workplace. This occurs a lot in high level employment situations with companies located on Wall Street, law firms or in universities.

3. Debt Consolidation – While student loans usually carry competitive rates and terms, there may be opportunities to consolidate multiple student loans into one payment.

By consolidating, the overall payment amount is usually lower than paying several individual loans. However, the individual should be cautious and perform some due diligence. This will help them find a loan with the best possible rates and low/no loan fees.

4. Debt Repayment Plan – The biggest mistake individuals with a lot of debt make, is to not set forth a viable budget and payment plan. One thing the debtor should consider is making lifestyle sacrifices earlier in their career to help facilitate larger payments before they take on a mortgage and family responsibilities. Also, larger principal payments should always be applied first to debt that carries the highest interest rates.

5. Payment Problems – If the debtor begins running into problems staying up on payments, they should contact the lender(s). Lenders are almost always willing to work out an alternative payment plan in order to avoid default issues. This is especially true with unsecured student loan debt.

Students who graduate with debt burden do not have to allow it to become a life burden. It would be a good idea for individuals, who have large amounts of student debt, to sit down once a year and look for opportunities to make the student loan repayment process a little less painful.