Divide your annual salary by 12 to get your monthly gross income and work out a budget to determine how much you can afford to pay on your student loans and how long it will take you to repay them.
Standard and Graduated Repayment
Standard Set monthly payments over 10 years. Higher monthly payments but lowest overall cost.
Graduated Payments start low, increase over time. Finish in 10 years. Lower monthly payments at the start but higher overall cost.
Income-Based and Extended Repayment
Income-Based Payments are tied to income. Finish in 10 years. Lower monthly payments at first but higher overall cost.
Extended Under certain conditions (consolidation or first
Loan Consolidation
Pay off or ‘refinance’ many loans with one new loan which has new loan terms and conditions. This offers convenience, an improved monthly cash flow from extended lower payments, additional deferments and new hardship possibilities. Each case is different and the decision to consolidate depends on each borrower’s educational debt, income and economic goals.
§ Only federal loans can be consolidated.
§ The interest rate is a weighted average rounded up one eighth of a percent and fixed.
§ Your servicer will provide the total cost of consolidation.
§ You should continue to pay your current loans until consolidation is completed.
§ In general it is best to consolidate after grace and deferment options are used.
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