With each new semester, student debt rises exponentially and so does the confusion and anxiety that comes with paying back the debt once higher education ends and the loans come due. Many students do not have the time or money to even think about paying back their debt while in school, which then leaves them with no plan for their debt once they graduate. Thankfully, lenders typically provide new graduates with a six-month grace period before their loans must be paid on a monthly basis. If they haven’t already, this period gives new graduates time to find a job and establish some savings before the payment requests roll in. During this time, it is essential to get your loans in order.  

How Much is Due and When it is Due

            The first thing new grads should do is develop an understanding of exactly what the loans entail. This can be done by making a few determinations. First, figure out who exactly the debt is owed to. Some grads will have taken all their loans from one source while others may have multiple sources. If a grad forgets where her loans came from, she can request a copy of her credit report, which lists all outstanding loans. Once this is done, the grad should make a spreadsheet with all of the lenders, their contact information, and their website. That information can then be used to figure out how much is owed overall, what monthly payment that amount translates to, and how long it will take to repay the loans. Having this information all in one place will make the task of repaying student loans seem a little less daunting.

Keep Contact Information Up to Date

            Once students graduate, many things change in their lives, including contact information. Physical addresses, email addresses, and phone numbers for college graduates are likely to change as he/she establishes independent living arrangements, often for the first time. Whatever the change may be, contact information must be updated with creditors. If the information is not updated, important communications may be missed that can cause a new graduate to fall behind on his loans. It is also important for anyone with student loans to notify their student loan providers if they are back in school as a full-time or half-time student because payments will often be deferred until graduation.

Don’t Miss Opportunities to Reduce Debt More Quickly

            There are many ways new graduates can reduce their final total of loans. Interest rate incentives given when enrolled in an automated payment plan is one opportunity. Another opportunity, if their salary allows, is those with student loans should pay more than the minimum monthly payments. This not only keeps the total amount paid down, it also gets the burden of loans off their backs sooner. Tax returns and bonuses are also great opportunities to make large strides in paying down loans.

Ask for Help If it is Needed

            If you are struggling with student loans it can never hurt to ask your loan provider for help. Oftentimes the loan provider will offer a temporary interest-rate reduction or provide information on income-driven repayment plans or loan consolidation.

Don’t Fall for Scams

            Bad actors have taken advantage of the student debt problem and created scams to pray on those desperate for help. Federal and state regulators have cracked down on these scams, but sometimes the most determined of these scam artists leak through the cracks. These scams often charge an upfront fee to purportedly lower or forgive someone’s student debt. Those in student debt should also be wary of those who contact them out of the blue offering ways to clear their debt. A great rule of thumb is to never give out sensitive information to unverified third parties. The key thing to remember is, if it seems too good to be true it probably is.

Editorial Assistance By: Michael Gee - Law Clerk


H. Van Smith
Connect with me
Trusted Virginia Attorney Serving Richmond to Williamsburg