.:!!Reducing Your Monthly Payment With Student Loan Refinancing !!:.

With rising education costs, a lot of students leave college with more than one study loan to pay for once they start working. This is not an ideal situation to be in if you are just about to start working and already you are deeply in debt. Nevertheless, fret not, as there are plenty of student loan consolidation programs available in the market today to help you refinance all your study loans into one and help you pay them off in a faster and more effective way.

Student loan consolidation companies offer good deals for freshmen out of college to successfully refinance and consolidate all their study loans into one at lower interest rates. To find the best rate for student loan consolidation however, you would need to accomplish some background research and obtain a few quotes from the relevant agencies and firm before you decide on which offer to take up. The best deals are usually those who offer the lowest interest rates, as well as those who allow longer repayment periods to help you service your debt more effective. With longer periods, your monthly repayment amounts would also be reduced considerably, thus instead of paying multiple loans, you could stick to just one payment and never would you have to worry about missing the payment deadline again as well.

Usually once you leave college, you have a grace period of around six months for you to find employment before you have to start repaying your study loans. Make use of this grace period to find the appropriate refinancing deal for yourself, and save yourself thousands of dollars at the end of the day. Remember to scout around extensively for the best loan consolidation companies around, so that you are able to obtain the best deal possible.

Research can be accomplished through the internet, or you could personally visit these companies to obtain quotes from every one of them. Remember to stick to the legitimate companies however, or you could end up in more financial trouble than before. Stick to the licensed and legal companies, you might want to check with friends of family members who have had experience in this field to help you out here.

Usually with student loan consolidation firms, you get rewarded with actions such as paying on time, as well as utilizing automatic-paying methods. Look around for companies that offer these incentives as you would gain an advantage by working with them. Remember that you can only refinance your loans once, thus take all the time that is needed to find the best deal possible. Make sure that the company you choose are easy to work with, and can be easily reached in the case of any complications.

Opt for student loan consolidation programs if you are serious about being debt-free before you get old. The faster you choose a good plan for yourself, the faster your debts will disappear.

Can Unemployed Graduates Solve Their Student Loan Problem During Recession?

The financial crisis hit the whole world badly. Since last year, many fresh graduates have been trying extremely hard to get themselves jobs in this economy. As a result, there are too many recent graduates who totally can't afford to make the payment for their student loans.

If you are one of the "victims" in the group, don't be panic! There is a proactive approach that can help to solve your current problem. It is possible for you to consolidate all of your student loans into one loan. By having loan consolidation, you not only reduce your interest rates and your monthly payment, you can also extend your loan repayment period.

There are 2 main types of study loan consolidation programs currently, i.e. federal and private student loan consolidation. All the companies that are providing loan consolidating services for both programs are regulated by federal and state law. However, the consolidation rates vary from one company to another. If you have both federal and private study loans, you are advised to put your priority on consolidating federal loans. This is because this type of consolidation program offers lower interest rates and longer repayment period up to 30 years. On the other hand, if you only have private student loan, then you can look for any bank or any lending institution that offers the best consolidation package that suits your needs most. The private loan consolidation rates normally are relatively higher compared with the federal ones.

Your important task is to find out the best package that provides you the solution to extend your repayment during your unemployment period. You may be too stressful when you can't find a job and yet you need to pay back your study loan. With this consolidation program, you will be relieved.

How to Pay Off Your Student Loans Faster

Do you know that student loans don't have to be a financial burden for you after your college life? There are ways for you to reduce your study debts and pay them off faster. Just follow the recommendations below. They will assist you to be debt free easier.

One of the best solutions is consolidating your student debts. You can consolidate all your study loans during the grace period right after your graduation. You should start searching for the potential lenders in the market who can consolidate your student loans. Look for the financial institution which can offer you the lowest interest rate.

Most of the college or university students take student loans to further their study. It is advised that when you are in college or university, you should not spend all your loans but to save as much as possible. You should take up a part time job to earn some money to pay off your study loan when you are still studying. You can also save the allowance that you earn from internship to pay off your study debt bit by bit.

Last but not the least, it is an important reminder that you should not apply for any credit card once you graduate. Even if you have secured a job after the completion of your study. You are advised not to possess a credit card. Just focus on paying off your student debt.

By taking the suggestions mentioned above, you will be getting debt free faster and it will ease you from having stress too.

What If a Student Defaults on Loan?

A student default on his study loan when he is not paying back. When a student who owes a loan to meet his educational expenses, sometimes fails to repay it. It affects his credit score and he must take some immediate steps to avoid any further problems. In this way you can make it right.

Your loan default causes different effects on variable points. Some of them are discussed below.

Credit Score

Student have to keep a full eye of effects of loan default. If a student defaults, may be he is not repaying but his loan still incurs interest. On non-payment, your credit report will go to the collection agencies and it will badly affect your rating.

Career

Loan default will certainly affect your future. The non-payment can hamper your career or job status. You may be called ineligible for doing job in some particular city, state or country. You may be removed from your existing post.

Other Finance Resources

Default on student loan ban create problem on the other parts like credit cards approval or mortgage etc. A student loan defaulter can not be discharged under Bankruptcy Chapter 7 or 13.

Available Solutions

The most easy way in this regard is make a proper budget plan and follow it strictly. Adjust your loan payments in your budget at first place. If other options are there like skipping your spring break or picking other class or work. Which can help to avoid your loan default then just go for them.

You can discuss all your financial matters with any professional when you have no other options. An expert can provide you a good advise to get your financial goals. These smart tactics can save your credit report from tarnishing. Be aware of other charges and interest costs which can be attached with your loan default.

Processing of Education Loan

Education is the essence of life. Government of India is promoting education loans so that no deserving student is denied education. Student who has secured admission in any institute of repute, whose degree/diploma is recognized by University/Institute affiliated to any Central/State Statutory Body or recognized by AICTE (All India Council of Technical Education) and other institutes of repute, is eligible for educational loan.

Banks give loans for paying fees of colleges, school, hostel, laboratory fees, buying equipments, purchasing books, to meet other course related expenses, etc.

While processing the loan application bank takes into consideration the tenure of the course, fees, other course related expenses and course material, for fixing the loan amount to be sanctioned.

At the time of loan processing bank can decide to disburse the loan directly to the college/institute depending on the fee schedule of the college/institute. The institute may be in abroad the bank will pay the fees in dollars or any other currency to the institute directly. The bank charges remittance fees for this.

Students don't have to start repaying loan amount immediately as done in the other loans. Generally repayment of loan commences 1 year after the completion of course or 6 months after securing a job, whichever is earlier. In some cases where courses have long duration the loan can be availed for long tenures of up to 7 years. The repayment tenure also includes the moratorium period. Now days most of the banks offer hassle free services and loans are being approved speedily.

The student who has taken loan also has the discretion for the repayment of the loan. If the student is coming from the family which is financially sound then the installments of the loan can be repaid while completing the course then his/her parents can pay the loan. But this has to be finalized with the bank during the processing of the loan. Then there is an option of repaying the loan after completing the course, this is given by the bank.

Let's see how the loan is processed.

If you have taken a loan of Rs 5lac for 7 years and the interest rate is 13.25 per cent a year. After you have completed the course, you take up a job and get a package of Rs 5lac a year. The EMI amount of the loan will be Rs 9,164, annually it would come out to be Rs 109,968.

Therefore in the first year of repayment, the interest calculated will be Rs 64,350, this can be deducted from the income while calculating tax. Hence you will save Rs 21,872. Thus the effective interest rate will stand around 10.75 per cent (instead of 13.25 per cent) for that particular year.

In case at the time of finalizing the loan repayment you accept moratorium on payment of interest then you don't have to pay anything till six months after the course is complete, or you get a job (whichever is earlier). In this case the interest is compounded quarterly and added to the principal sum for repayment. The interest rate will be higher but this can be helpful for those who cannot repay the loan during the course period.

For education loan banks do not charge prepayment penalty, as in case of other loans. If you are capable to prepay in the early year of your career you can pay the entire outstanding loan amount without any penalty.

The most important thing to remember is the bank sanction loan according to the tenure of the course in case you are unable to complete the course you will have to start paying the EMIs immediately. You can consult your bank in such cases if they can give you a grace period either to continue your studies or to start repaying the loan, but you have to take the final decision.

Education Loan a Big Aid For Aspiring Students

With time the cost of education has gone up. Every student is not lucky to come from a financially well off family. There are many students who do well in academics but belong to poor family or a family where it is difficult to get one day meal. Hence these students have to take up job prematurely and this leads to end of promising talents.

Government and NGOs have introduced scholarship schemes to help such students but these are less in number and only few of the lucky one get it. Now the scenario has completely changed with the introduction of educational loan. Many nationalized banks have various education loan schemes for students.

Education loan is given for pursuing higher education in India or abroad where admission has been secured. Loan covers fees payable to college/school/hostel, examination/Library/ laboratory fees, for purchasing of books/equipment/instruments, caution deposit/building fund/refundable deposit (maximum 10% of tuition fees for the entire course), travel expenses/passage money for studies abroad, purchase of computers considered necessary for completion of course and any other expenses required to complete the course like study tours, project work etc.

Students who have secured admission in courses having employment prospects such as graduation courses/post graduation courses/professional courses and reputed institutes, whose degree/diploma is recognized by UGC/government/AICTE, etc., are eligible for loan.

The amount of loan may vary from bank to bank for instance country's largest lender bank State Bank of India gives maximum loan of Rs. 10 lacs for studies in India and for studies abroad, maximum Rs. 20 lacs. Loan amount has a security attached to it, i.e. according to bank norms an individual has to produce collateral for any loan above Rs 4 lakh. Taking in consideration this government has come forward as a counter-guarantor so that the financial burden does not fall entirely on the family.

The repayment of loan amount commences one year after course completion or six months after getting job, whichever is earlier. The student can repay loan in equated monthly installments (EMI)

Banks have certain documentation requirements to get the loan they are:

• Completed Education Loan Application Form.
• Mark sheets of last qualifying examination for school and graduate studies in India
• Proof of admission scholarship, studentship etc
• Schedule of expenses for the specified course
• Copies of letter confirming scholarship, etc.
• Copies of foreign exchange permit, if applicable.
• 2 passport size photographs
• Borrower's Bank account statement for the last six months
• Income tax assessment order, of last 2 years
• Brief statement of assets and liabilities, of the Co-borrower
• Proof of Income (i.e. Salary slips/ Form 16 etc)

Information about Educational Loan from Various Banks in India with their education loan rate at RupeeTimes.com