| udent, do you find it hard to repay your student | | | | payment for up to 10 years depending on the |
| loans? While student loans are great in that you and I | | | | amount you owe. |
| will probably not be able to afford a tertiary | | | | 2. Extended Repayment Plan |
| education without it. On the other hand, it can be | | | | An extended repayment plan allows you up to 30 |
| difficult to pay the monthly payments on time due to | | | | years. Obviously, the longer the period, the less |
| the high interest rate and other external factors | | | | amount you need to repay each month. Do note, |
| which can challenge your wallet. | | | | however that you will end up paying more as a |
| If you have a difficult time in repaying your student | | | | whole if you spread your payment over longer |
| loans, you might want to consider a direct student | | | | periods of time due to interest rates. |
| loan consolidation. | | | | 3. Graduated Repayment Plan |
| So what is a direct student loan consolidation? | | | | Graduated Repayment Plan usually have a repayment |
| In essence, it is simply exchanging or consolidating | | | | period between 12 and 30 years. The main difference |
| your existing outstanding student loans with higher | | | | between graduated and extended repayment plan is |
| interest rates for one loan with a more manageable, | | | | for graduated, the amount of your monthly payment |
| fixed interest rate. The interest rate is determined by | | | | will increase every two years. |
| the average of your loans, rounded to the nearest | | | | 4. Income Contingent Repayment Plan |
| 0.125 per cent. | | | | If you have a job, then this plan may be what you |
| A direct student loan consolidation is especially useful | | | | are looking for. The income contingent repayment |
| if you know you are about to default on your | | | | plan set a monthly payment based on your gross |
| monthly student loan payments. A direct student loan | | | | annual income. Other factors include your family size |
| consolidation can mean a new start since it is | | | | and the amount owe. The repayment period is |
| considered a new loan. | | | | usually 25 years. |
| When you consolidate your student loans under a | | | | A word of caution, if you are close to paying off |
| new loan, your existing loans will show up on your | | | | your student loans, then a direct student loan |
| credit card as paid off, thereby increasing your credit | | | | consolidation may not be suitable for you since you |
| score. | | | | will be paying more due to interest rates over the |
| Before getting a direct student loan consolidation, | | | | long term. |
| you need to know the types of plans for repaying. | | | | However, if you have difficulty in repaying your |
| There are four major types. You may like to | | | | student loans and it is still years away from being |
| investigate more to consider which is best for your | | | | paid off, then a direct student loan consolidation may |
| needs. | | | | be the answer. Not only do you pay less interest |
| 1. Standard Repayment Plan | | | | over the long term but it can improve your credit |
| Standard Repayment Plan allows you a fixed monthly | | | | rating as well. |