To create a new Federal Student Aid (FSA) ID, go to https://fsaid. ed. gov/npas/index. htm and choose a username and password. You will then be asked some questions to verify your identity. You must have a valid email address for your FSA ID. Don’t use your school email if you won’t have access to it after you graduate. You may miss important notices from the federal government.
If you complete exit counseling through StudentLoans. gov, you’ll receive a certificate of completion. Print this out and keep it for your records. You will probably need to submit it to your financial aid office to show that you’ve completed the program.
As of 2019, there are 9 loan servicers for federal student loans: CornerStone, MOHELA, FedLoan Servicing (PHEAA), Navient, Granite – GSMR, Nelnet, Great Lakes Educational Loan Services, Inc. , OSLA Servicing, and HESC/Edfinancial. You do not get to choose which company services your loan or request a change if you don’t like your loan servicer.
Unless you consolidate your federal loans, you may even have different due dates for different loans, particularly if they are different types of loans. For example, if some of your loans are Direct Loans and others are Perkins Loans, you may have different servicers and different due dates for the different types of loans.
If you have a Perkins Loan, the length of your grace period depends on the school that gave you the loan. Contact your school’s financial aid office to find out your grace period if it wasn’t explained to you during exit counseling.
Generally, you want to estimate your expenses high and your income low. For example, if you get paid twice a month and your pay varies between $850 and $650, you might budget your income at $700 a month. However, if you have expenses that are always the exact same amount, it’s okay to use that exact amount in your budget. Track your expenses over the past 2 or 3 months so your budget is based on reality, not on an ideal. If you find that you need to cut expenses, you’ll have a realistic picture of where your money goes and can figure out what to trim or eliminate entirely. [10] X Expert Source Trent Larsen, CFP®Certified Financial Planner Expert Interview. 22 July 2020.
Even though the calculator produces an estimate, that estimate is based on your actual loan information, so it should be fairly accurate. It also allows you to compare the repayment plans available and see what your monthly payments will be, how long it will take for you to pay off your loans, and what the total amount you pay back will be.
The standard repayment plan is by far the most popular. If you don’t choose an alternate repayment plan, you’ll be automatically enrolled in the standard plan.
If it later turns out that you aren’t making as much money as you thought you would and won’t be able to make the larger payments, you may be able to switch to a different plan. However, doing so will likely mean that you end up taking longer to pay off your student loans, as well as paying more overall.
You may also want an extended repayment plan if you left school before graduating and aren’t able to earn the same kind of money you would if you had a degree.
Income-based repayment plans typically aren’t available for parent-borrowers of PLUS Loans. Income-based repayment plans last for either 20 or 25 years, as long as you remain eligible during that time. After 25 years, any remaining loan balance will be forgiven. You may be responsible for income taxes on the portion of your student loans that are forgiven.
Only use automatic payments if you’re confident the money for your student loan payment will be in your bank account. You might consider using a separate savings account for student loans and transferring money there for your monthly payments. If you can start the account with a cushion of 2 or 3 loan payments you can make sure there will always be enough in the account to cover the payment.
You have to be proactive about this. If you simply stop making your payments, it will negatively affect your credit score. Too many missing payments will cause your loans to go into default, which can be disastrous for your ability to borrow in the future. If you qualify for deferment or forbearance, your loan servicer may apply the deferment or forbearance back to your oldest missed payment. However, this will decrease the number of payments you don’t have to make in the future. Depending on the type of loan you have, your loan may still continue to accrue interest while payments are in deferment or forbearance.
Even though you won’t get a lower interest rate, consolidations loans can be especially helpful if you have several years worth of loans that are with different servicers and have different due dates. Generally, if you have loans with different servicers, they would all be moved to a single servicer when you consolidate. If you have different types of loans, you may end up with two consolidation loans rather than just one. However, this can still make your payments easier to manage.
While you can get a credit report for free each year from each of the 3 credit bureaus (TransUnion, Equifax, and Experian), these reports don’t include your scores. You can use free websites or apps, such as Credit Karma, Credit Sesame, or Wallet Hub, to check your credit score. You can also pay for access to your official credit score from one of the 3 credit bureaus.
If you can’t get your loans refinanced at a lower rate than what you’re currently paying, there’s no point in refinancing. Even if you’re offered a lower monthly payment, you’ll still be paying off your student loans for a longer period of time and will end up paying more overall. Nerd Wallet has an online tool you can use to compare companies and find the best fit for your needs. Go to https://www. nerdwallet. com/refinancing-student-loans and enter your information to get started.
You can use these quotes to compare different lending companies. However, keep in mind that the terms of the loan you’re ultimately offered may not be the same as the one in the quote.
After your application is complete, you’ll get a refinancing offer. You may have a limited period of time to either accept or reject that offer. If you accept the offer, the lender will pay off your student loans for you and you will then make your monthly payments to that lender rather than your previous loan servicer. Try to only submit a full application to one lender. Each lender will do a hard pull on your credit, and too many hard pulls can have a significant negative impact on your credit score.
Remember only to sign up for automatic payments if you’re confident the money will be in your account to cover the payment on the due date each month. If a payment is returned, you’ll be on the hook for additional fees from the lender as well as bank fees. In addition, your payment will be recorded as late, which can hurt your credit.
