However, they mean something different for federal and private student loans. Student loan refinancing and student loan consolidation are both ways to combine student loans. What’s the difference between student loan refinancing and student loan consolidation? Keep in mind that while you can refinance federal student loans, you’ll lose your federal benefits and protections, including access to IDR plans and student loan forgiveness programs.Īll APRs reflect autopay and loyalty discounts where available | 1Citizens Disclosures | 2College Ave Disclosures | 5EDvestinU Disclosures | 3 ELFI Disclosures | 4INvestEd Disclosures | 7ISL Education Lending Disclosures | 8Nelnet Bank Disclosures Either scenario might get you a lower monthly payment. Or you could choose to extend your repayment term. Refinancing your debt: If you refinance your student loans, you might qualify for a lower interest rate.Just remember that the longer your repayment term, the more you’ll pay in interest over time. With this type of loan, you can extend your repayment term up to 30 years, which could lower your payments. Consolidating your loans: You can consolidate multiple federal student loans with a Direct Consolidation Loan.Under an IDR plan, your payments are based on your discretionary income, which might reduce your monthly payment amount - even to $0 in some cases. ![]() Signing up for an income-driven repayment plan: If you have federal student loans, you might be able to sign up for one of the four IDR plans.There are several ways to potentially lower your student loan payments. How can you lower your monthly student loan payments? However, there are other options to streamline your repayment, such as student loan refinancing. Keep in mind: Unfortunately, private student loan forgiveness doesn’t exist. Depending on the plan, your loans could be forgiven after 20 to 25 years of payments. You could also qualify for loan forgiveness under an IDR plan itself. Some federal student loan forgiveness programs require you to make payments under an eligible repayment plan.įor example, to potentially qualify for Public Service Loan Forgiveness, you’ll need to work for 10 years at a government or nonprofit agency while making qualifying payments under an IDR plan. What repayment plan qualifies for student loan forgiveness? You can typically only change your repayment plan by refinancing your private student loans.Ĭheck Out: When to Refinance Student Loans There are generally fewer private student loan repayment options, and available repayment plans will depend on your lender. You might also be able to apply for a new repayment plan online. If you want to change your federal student loan repayment plan, contact your loan servicer. There are several federal student loan repayment options in addition to the standard repayment plan, including graduated repayment plans, extended repayment plans, and IDR plans. See: What Is a Student Loan Grace Period? How do you change student loan repayment plans? Be sure to review your loan agreement to see when your payments will begin. If you have private student loans, you might have to make payments while you’re in school. This means most loans will accrue interest during grace periods. Keep in mind: Unless you have subsidized loans, student loans begin accruing interest as soon as you take them out. Private student loans: Depends on the lender (many lenders offer six-month grace periods).Parent PLUS Loans: No grace period (might be able to defer payments until after your child’s graduation).Grad PLUS Loans: No grace period (might be able to defer payments until after graduation).Direct Subsidized and Unsubsidized Loans: Six months.Here’s the grace period you can expect for a few types of student loans: How long is the grace period on student loans?ĭepending on what type of loans you have, you might not have to start making payments until six months or more after graduation - this is known as a grace period. How can you pay off student loans faster?.How can I pay off $200k in student loans?.How long does it take to pay off $100,000 in student loans?.How do I pay off $50k in student loans?.What’s the difference between student loan refinancing and student loan consolidation?. ![]() How can you lower your monthly student loan payments?.What repayment plan qualifies for student loan forgiveness?.How do you change student loan repayment plans?.How long is the grace period on student loans?.Here are answers to several commonly asked questions about student loan repayment: Frequently asked questions about student loan repayment ![]() This could help you pay off your debt faster and save you money on interest charges. Tip: If you can afford it, it’s often a good idea to pay more than your required minimum payment.
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