Bruce Mesnekoff discuss how to avoid defaulting on student loans

1. Bruce Mesnekoff discuss how to avoid defaulting on student loans Bruce Mesnekoff Stuent Loan Expert on Radio show. Hello Bruce Mesnekoff , Welcome to Our Radio Show, Its always nice for us when you have something for our listeners, what we are discussing today. Bruce Mesnekoff to Jerry Scott: Hey Jerry, Thank you for calling me again, I am always happy to helping our listeners about consolidations and how they can avoid defaulting on student loans. It is important for those who have been tasked with remembering to pay off their student loans to pay their loans on time and avoid default. While delinquency does happen from time to time, this is not the same time as a default. When you find yourself unable to pay loans on time, you should contact the loan provider immediately, so that you can avoid default. Being in regular contact with your loan provider is the best way to avoid a default. They will let you know about the terms and conditions of your repayment agreement. The loan servicing outlet is also responsible for laying out your options in a timely fashion. It is in your best interests to avoid a default, as up to 25 percent of the loan’s principal is tacked onto the total bill. There is a wide range of repayment plans that can be set up to meet the person’s needs. A person can set up a repayment plan that is based on the amount of income that they are currently earning. While most student loan repayment plans take place over the course of ten years, a repayment plan that is income driven can be spread over the course of as many as 25 years. These plans cap the person’s monthly payments at 10 or 15 percent of their overall income, which allows them to keep the rest of their bills paid, while avoiding a default on their student loans. There are certain drawbacks, as a longer loan leads to paying additional interest over the life of the repayment agreement. Former students who have not been able to pay their loans back or find a job that will allow them to earn the income needed to do so are able to file a forbearance. This delays their student loans repayments until they are able to find a job that will properly compensate them for the schooling that they have received. Choosing this option means sitting down with your loan’s provider and coming up with an agreement that suits both parties. If the loan servicing outlet agrees to a forbearance, this buys some time for the person to continue searching for a job without being held responsible for the loan principal.

2. Those who do not qualify for student loan forbearance are eligible for a deferment. A deferment differs from forbearance in a few important ways. Forbearance allows the person to push their student loan payments back by 12 months, without making payments, but the interest on their loan continues to add up. During a deferment, the interest does not continue to accrue. Another option available to those who are in danger of defaulting on their loans is to refinance. This is only available to students who received their loans from a private loan institution. These institutions can be persuaded to extend the loan’s term, while also lowering the overall interest rate. These loans are known as variable or fixed rate loans. By lengthening the term of the loan and lowering the monthly interest rate, the person can also their monthly payments and decrease the chances of going into default. But renegotiations the terms of your loan or asking for more time to pay are just a few of the ways that a person can avoid default. There are other steps that can be taken, so that you are not borrowing too much or setting yourself up for an impossible repayment plan. Where many students falter is by not having a clear understanding of what their loan agreement entails. Don’t ever mistake your loan for a grant or a scholarship. A grant or a scholarship essentially functions as a gift, whereas a loan has to be paid back. Take the time to read all of your legal documentation. A promissory note is a legally binding document that should not be signed until it has been read and the person has a clear understanding of what they agreeing to. Students who are in need of money will sometimes allow their judgments to be clouded. Other students end up borrowing far more money than they actually need for their school expenses. While it may be more convenient to not to have to work during your schooling, borrowing extra money for life’s expenses leads to a much higher student loan borrower upon completion of secondary education. Instead of asking for the maximum amount that you are allowed to receive, schedule an appointment with your loan’s provider, so that you can assess your expenses accordingly and ask for a smaller loan that better suits your individual needs. The last and most crucial aspect of avoiding a default is personal organization. You must keep well organized records of your loan and all the payments you have made. Any paperwork that relates to your loan should be kept in a safe place. These records could be the difference between a default and paying the loan off in a timely fashion. It is much easier to avoid default than you may think. Your loan providers are on hand, ready to work with you if you run into issues with repayment. Even when payment problems arise, notifying your loan servicing outlet can help you to avoid a default.

3. There are measures that can be taken when receiving the student loan, as well as after the person’s education is finished. By taking the proper precautions at both ends of the process, a student can receive the loans they need, without putting themselves into crippling debt and defaulting on their student loan agreement. Contact Bruce mesnekoff for any further assistance Student Loan Help Center General Manager Bruce Mesnekoff joins us to Discuss the Student Loan Situation in America