Students who graduate college with student loan debt often seek out assistance plans as a way to make their college loan debts more affordable, and as a result, many have turned to student loan forbearance options as a way to avoid repayment of debt. Typically, graduates have a grace period where they are not required to begin paying on student loan debts, but once that grace period has expired, students must begin immediately paying their debt or run the risk of doing damage to their credit score if payments are missed.
While there are many students who have been able to begin repaying their student loan obligations, difficulties with finding a job have been present for many graduates and, as a result, these individuals have simply been unable to begin repaying their debt. A recent report stated that student loan debt has surpassed credit card debt, which is troubling for many who are having difficulty finding a stable source of income which they can use to combat these student loans.
Yet, forbearance options, like those on federal student loan debt, allows individuals who may be unemployed to forgo making student loan repayments for a set period of time. Obviously, this has been greatly helpful for many students in the past, but there is concern over the fact that some forbearance plans still allow interest to build, which can increase the overall costs that a student must meet on their college loan debt.
Understandably, there are some individuals who have been greatly helped by these forbearance options as they aren’t in a position to afford even a minimal student loan repayment plan, but federal student loans offer alternative options like income-based repayment and income contingent plans which can lower the monthly payment that a student must meet. Also, there are some forgiveness options for teachers, who only have to repay their debt for up to 10 years, while others may be forgiven after 25 years, but of course this is only helpful to those with a large amount of debt who would not have been able to erase their student loan obligations in that timeframe.
While more individuals feel that student loans are necessary, since college costs are increasing at public universities and private universities are still incredibly expensive, there are options for students to meet these costs outside of student loans. Many financial aid counselors often suggest that students exhaust all of their scholarship and college grant options before turning to student loans, as students have been able to acquire free financial aid which, if it did not meet the entirety of their college costs at least allowed them to borrow a smaller amount in student loans and exit college with less debt.