Student loan debt relief options can be available through a variety of repayment plans, but not all of these programs may be beneficial, or even available, to all college graduates. Understandably, student loan debt can be incredibly burdensome for many college graduates, especially those who have recently graduated and have entered an unwelcoming job market.
Typically, certain options are available to college graduates, when it concerns their repayment opportunities, but these repayment plans may be limited depending upon the type of loans they have. Usually, students will be able to either borrow private student loans or federal student loans, and depending upon the types of loans or mixture of loans, various repayment opportunities can be helpful.
Yet, common ways of dealing with student loan debt often come in the form of student loan consolidation plans. While there are opportunities, like federal student loan consolidations, which can be affordable and come with a low interest rate, but there are some financial advisers who feel consolidating student loan debt is not always the best option.
In the same theme, options like income-based repayment plans, available for students who may have federal student loan debt, can be helpful since only a percentage of a graduate’s income must be applied toward their monthly student loan payment.
While opportunities like these can be helpful if a graduate fears they will miss payments or be unable to make their monthly student loan payment requirement, advisers often warn against these options which can lower monthly payments and extend student loan repayment terms. The reason advisers often suggest that graduates avoid these types of plans, if possible, is because interest can build and overall costs will increase.
Again, missing payments or defaulting on college loans is to be avoided at all costs, but in cases where payments can be met, or better yet, more than a minimum monthly payment can be made, it will often pay off in the long run. Student loan consolidations, income-based repayment plans, or even forbearance programs may be necessary in some cases, but for graduates who can meet repayment costs, advisers often believe that most student loan situations will benefit from the graduate focusing as much money as they can on their debt so as to erase these loans fast.