I went to college at Pennsylvania Culinary Institute in Pittsburgh, PA. The school was great and I graduated with an associate’s degree in Pastry Arts.
With the degree, however, came a large student loan balance. I would like to share with you the 4 easy steps I took and that you can take as well to restructure your student loan. This will really help for those who are in money trouble. Especially in today’s economy.
The first thing I did was pull a credit report from freecreditreport.com for myself and made sure that all my loans were correct.
When you get loans through a school they start a new loan for each semester. In my case I had two loans and I just wanted to make sure everything was correct and active on them.
The second step I took was to consolidate my loans. I had to take out two loans which meant I would have to make two separate payments.
By consolidating I now only have to make on payment. This step is a must. If you do nothing else do this. You can almost always get a better rate which will save thousands in the end.
The third step I took to restructure my student loan was to place my loans in deferment, meaning I had a period after school where I did not have to make a payment and did not get hit with a non-payment fee.
The loan instead just collected interest. This allowed me to get on my feet. Usually they will give you a six month deferment period. If you need more time you can always work something out.
Federal Income Based Repayment Plan
Next thing that I checked out while restructuring my student loan was the federal income based repayment plan. This program puts a set cap on your payments.
Currently the cap is 15 percent if you are living above the poverty level.. And 10 percent for anyone living 150 percent under the poverty level. This really works out great for people who are in financial troubles right now.
There you have it. Follow these 4 easy steps to restructure you student loans. Do not stress about money. There are programs out there to help you get you finances under control.
Hint: If you can spare the extra money, just putting an extra $50-$100 on your loan each month will get you to financial freedom faster than you ever imagined. I did this step for two years and now only have $4000 left on a $13000 loan and I have only been paying on it since mid 2006.