Tips to Take Control of Your Student Loan Debt

When you decided to go back to college or start your degree in the Chicago area, chances are you took out student loans. If you are like millions of Americans, you have finished school, but are saddled with overwhelming student loan debt.  Not only have your financial conditions not improved, but you are stressed about the way the debt affects other aspects of your life from buying a car to qualifying for a mortgage. At Benjamin Brand, LLP, we often help clients in the West Loop address financial issues, from bankruptcy and student loan debt to mortgage restructuring and foreclosure.

Understand your Student Loan Debt

If your life is full, juggling family, work and friends, it’s tempting to avoid dealing with student loans and other financial issues. Take the first step toward escaping student loan debt by analyzing the information in the emails or envelopes delivered by USPS from your student loan servicers. Here are some tips to reclaim control of your school debt by getting to know it a bit better.

Start by writing everything down or entering it into a spreadsheet. Sometimes it helps to be able to see everything laid out.

  • How many student loans do you have? Are they public or private? The federal government backs public loans, but each type has different borrower protections. Take some time to read the fine print and understand what they are.
  • What are due dates and minimum payments for each? This can help you build a realistic monthly budget that incorporates the amounts.
  • What is the repayment timeline for each loan? Most default to a 10-year plan, but if you can pay them off sooner, you’ll pay less in interest over the loan’s term. Make sure there are no prepayment penalties.
  • What is the balance and interest rate for each? This will tell you how much you are estimated to pay over the life of the loan. It can also help you decide if refinancing the loan is a viable option.

Because student loans are installment loans instead of revolving debt, like credit cards, credit scoring models are generally more forgiving. Make on-time minimum payments to give your credit score a boost and limit credit card use. Maxing them out hurts your score.

Consult with a Chicago Attorney Near Me

Our team can help you make sense of your student loan paperwork and work with you to develop a plan to get your financial life back on track. Are the default minimum requirements out of the question?  We will discuss which repayment plans work best for your budget and current situation. Deferment may sound good, but the downside is an inflated balance due to interest fees. Contact us today to schedule an appointment and learn more about how we can help you take back control of your student loans and move on with your life.

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