Student Loans

Avoid Turbulence! Manage Student Loans Wisely

A student loan is the first credit management experience for many students. To protect your credit history, you must successfully repay your student loan. Below are tips to consider before borrowing, during school, and after school, when entering repayment of your loan.

Before

Always go for free money first. When paying for school, take advantage of all grants, scholarships and college savings available to you before taking out a student loan. If you must borrow to pay for school, exhaust all your federal loan options before considering “private” (sometimes called “alternative”) loans, which can have higher interest rates and fewer flexible repayment options.

Borrow only what you’ll need. When accepting a student loan, know how much money you’ll need to cover your school expenses, including basic living expenses for the school term. Many students are offered more loan funds than they actually need. Be cautious in pursuing additional loans outside of those offered by your financial aid office. Ask your financial aid counselor for advice if you’re considering taking a “private” student loan. Since loans must be repaid, it’s best to borrow only what you need to pay for school.

Be salary savvy. Consider the starting salary for your chosen career before borrowing student loans. A good guideline is to make sure your student loan payments won’t exceed 8% of your first-year monthly income after graduation. The debt/salary wizard at www.ocap.org can help you figure out how much you can afford to borrow based on your expected salary or help you determine the salary you’ll need to comfortably repay your student loan debt.

Know your dough. Visit www.ocap.org , the Oklahoma College Assistance Program’s Web site, to learn more about federal student loan programs and how you can make them work for you.

During

Monitor your needs. Last semester, did you find yourself with extra loan funds or were you struggling to get by? Pay attention to your needs and adjust your borrowing accordingly. Decide each time to borrow only what you need for school. Remember to always go for scholarships and grants before taking out a student loan, and exhaust your federal loan options before considering “private” or “alternative” loans.

Take interest in paying your interest. If given the option to pay the interest accrued on unsubsidized loans while in college, do it. These quarterly payments are usually affordable on a tight budget and can save you hundreds over the life of your loan!

After

Ponder payments. Before your grace period ends, adjust your budget to include your monthly student loan payment. Consider your spending habits and priorities and make changes if needed. For example, you may need to wait to buy a new car so you can make your student loan payment. Also, be sure to select the best repayment method for you. Talk to your lender about your options.

Don’t nix the fixed. Recognize that your student loan payment is a fixed expense, just like your car payment, rent or any other fixed monthly expense. Repaying your student loan is not optional, even if you withdraw from school before graduating.

Pay on time. Make your loan payments on time or your credit score could suffer! If you know your payment will be late, contact your lender immediately to discuss your situation. Even if you apply for a deferment or forbearance, continue making payments on your student loan until you receive confirmation that your request has been processed and approved.

Talk it up. Communicate with your lender regularly. Notify your lender of any changes in your name, address or ability to repay. There are many ways your lender can help if you’re having trouble making your payment, but you have to stay in contact.

Revamp your repayment. Consider different repayment schedules. Lenders offer alternate repayment plans to address borrower needs. Also, if you need more flexibility due to economic hardship, unemployment or other unforeseen circumstances, or you just can’t make your payment, there are several options to help you keep your account current. Keep in mind that flexible repayment programs, like deferment and forbearance, aren't automatic - if you need help, you have to ask for it.

Don’t toss it. Keep copies of all loan paperwork. Create a "my student loan" file to hold statements, notices and other important documents.

Ask questions! This is your money we're talking about, so don't be afraid to ask for help or for more information when you just don't get it. Call the financial aid department, your lender, your guarantor, or a consumer credit counseling service.

Rose State College
6420 S.E. 15th Street.
Midwest City, OK 73110-2704
Phone: 405-733-ROSE (7673)
Toll Free: 866 621-0987

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