I was recently doing a thorough research on the topic "Cause of rising Student Loan". I managed to gather lot of important data on this topic. Since i am very closely associated with this forum i decided to share this information with the community.
I hope this will help you all.
Recent survey, reports that an average undergraduate student owes about $,000 in debt when he leaves school. The average unpaid balances on their credit cards are usually $,00. On the other hand graduate students, has an average balance of $,00 as debts. Many students go unaware of their debt until it is too late.
[color=blue]Cause of rising Student Loan[/color]
Rising costs of higher education is making it a compulsion for most families to borrow money in order to meet up with the educational costs. But before it is too late you need to know how to get started and get yourself free from this financial hassle.
The financial aid and the repayment process might be different for individual students depending on the debt amount. However, debt consolidation is the right and the most popular approach while journeying towards being debt free.
How is debt consolidation helpful to a debt-struck student?
Student loan consolidation is one of the most popular methods for reducing and paying off student debt. Student loans are one of the most difficult debts to be consolidated. However, some good companies do help you in this matter.
Debt consolidation is beneficial for student loans because:
Debt consolidation allows you to roll your existing federal loans into a single low-interest loan. This in turn will lower your monthly payment by $100 or more. The extra savings can be used towards paying the principal amount on your loan. By doing this you will be able to move ahead of your debt burdens much faster.
With the interest rates currently at a historic low, now is the appropriate time to consolidate your student loans. Debt consolidation simplifies and makes your debts more concise, and this helps you to get lower interest rates in general. Moreover, when you go for a consolidation youll pay one interest rate, and not multiple rates.
While consolidating the loans some lending companies offer rate reductions for students while they are in their grace period. However experts caution you to avoid companies that demands immediate payment after the grace period. There are financing companies which does not restrict you on this issue. Try and opt for them.
Some companies also offer additional reduction rates at 1% a year if you are regular at your payments for consecutive two years. Initially this might seem less but when you calculate it over a longer period it saves you hundreds of dollars.
Consolidation can also lower your payment by combining loans. Most consolidation lenders, however, will not consolidate less than $7500 total in student loans.
The repayment period of most of these loans is usually 12-30 years. The process can have a fixed monthly payment or it gets graduated over time. If the extended repayment period takes longer it is obvious that the loan gets costlier. With consolidation of the loan the payoff gets accelerated within a reasonable period and does not elongate the loan for the full period.
Student debt consolidation also saves you a great amount of time and effort. Managing one monthly payment is much easier and hassle free when compared to managing multiple payments.
Guidelines to help you choose the right debt consolidation company[/color]
Experts caution that not all student loan consolidation products are alike. Enquire thoroughly on issues mentioned below before you make your final selection.
Whether the lender offers an interest rate reduction for on-time payment.
Whether your lender is flexible enough to fix your payment plan keeping in mind your present financial ability or if he is capable to arrange the payment in case you want to pay more and clear your debts.
How good is the customer care or help desk of the company you opt for?
Does the lender offer a range of plans to meet your specific income and financial needs? Do you have the choice of multiple plans to debt repayment keeping in mind your financial needs and capability?
Some smart and calculative market research can save you from a lot of unnecessary hassles, along with a considerable amount of time and money.
I hope that this information helps those who are struggling with outstanding student loan.
By signing up a debt counseling session, your provided details (Name, Email ID and Phone No.) will be forwarded to the company advertising on the DebtCC. However, you have no obligation to use their services.
Some creditors and collection agencies refuse to lower the payoff amount, interest rate, and fees owed by the consumer.
Creditors/collection agencies can make collection calls and file lawsuits against the consumers represented by the debt relief companies.
Debt relief services may have a negative impact on the consumer's creditworthiness and his overall debt amount may increase due to the accumulation of extra fees.
The amount which the consumer saves with the use of debt relief services can be regarded as taxable income.