Repaying Student Loans: What Are My Options?
Whether you’re a recent grad or you’ve been out of school for a while now, there’s one thing we can all agree on: we’re tired of student loans.
The good news: there are a number of programs designed to help graduates repay their loans.
If your loans are currently with companies like Navient, Nelnet, or Great Lakes, among others, and you are struggling to make ends meet, options like graduated repayment or the various income-based plans may be helpful.
Repayment Options
1. Graduated Repayment – With this option, your payments are lowered considerably, but monthly payment amounts will increase every two years until the loan is paid off. The loan term is set at 10 years, but can be extended in many cases. You’ll save money on a monthly basis, but you’ll end up paying a bit more than the standard repayment plan in the long-run. This plan was designed primarily with the working professional in mind – your starting salary might be considerably less than with a few years’ experience. As your salary (hopefully) increases, so will your loan payments.
2. Income-Based Options (including Income-Based, Income-Contingent, Pay-As-You-Earn, and Revised Pay-As-You-Earn) - In each of these programs, your loan payment is based on a percentage of your take-home pay. After 10-25 years, the remaining balance on your loan is forgiven if other conditions are met. This program is great for certain careers. Teachers and public service workers, for example, benefit tremendously, as their loans are forgiven after just 10 years of income-based payments. Workers in other fields might not benefit as much – 25 years is a long time to pay interest, and the forgiven balance is treated like taxable income for that year (meaning a bigger tax bill).
3. Federal Consolidation – With this option, your federal loans are combined into one loan, with an interest rate weighted on the loans combined. This results in one payment per month instead of paying on multiple loans. With the Federal Consolidation program alone, you won’t see any savings at all – it is simply a way to make your loans easier to manage. To qualify for some of the other repayment plans, you may need to Federally Consolidate your loans.
Student Loan Refinance
3Rivers has recently launched a program designed to help graduates manage their student loans better. Our hope is to refinance your loans at a lower interest rate, with a lower monthly payment, or with more favorable repayment terms. This means you may pay less in the long run, pay less monthly, or only pay on your loans for five years instead of 25. Time is money!
With Student Loan Refinance with 3Rivers, or any other company, refinancing your Federal student loans will forfeit all federal benefits. It will also disqualify you for any of the above-mentioned repayment plans.
Action Plan
- Call your student loan servicer to ask about the benefits you qualify for – income based repayment, graduated repayment, and loan forgiveness, or check out this page to view your Federal options.
- Explore our Student Loan Refinance calculator to see how much you could save by refinancing.
- Schedule a time to meet with one of our loan specialists, or drop by your nearest branch with questions.