Once you graduate with student loans, you will likely have a grace period before you need to start making payments on your debt. The grace period can help new graduates get settled in a new job before they have to start making the minimum payments. Still, depending on the type of education debt you have, the grace period could vary depending on the loan’s terms. The period could be six months or more, and while that might seem like a generous time period, it may not be enough for some graduates. Luckily, you have a few options.
Refinancing Your Current Loans
Refinancing your education debt has several benefits, such as consolidating multiple loans into one monthly payment. It can also lower your monthly expenses. If you have more time to pay back the amount, you won’t need to pay as much back each month, and this is often ideal for recent graduates in entry-level positions. Taking advantage of NaviRefi student loan refinancing can make it easier on your finances.
Look to Deferment
If you are facing financial hardship or are currently unemployed, you may want to look into deferment. This simply means postponing the need to make minimum repayments until a later date. While interest will likely continue accruing, you won’t have to pay hundreds or thousands of dollars a month on your debt. You can often get a deferment of up to three years, but it will not automatically apply unless you reach out to the lender.
You may need to provide documentation showing you are facing financial hardship, such as tax returns or bank statements. And you may need to show them you are actively looking for a full-time job. This may require you to keep track of cover letters or confirmations of job applications and interviews. Not having the required documentation may mean the lender requires you to begin making minimum payments.
Look to Side Gigs or Part-Time Work
If you do not have a full-time job yet, you might be able to find part-time work or side gigs so you can make monthly minimums. There are many simple ways to make money online you can look into. You could combine several side gigs, such as delivering groceries or meals or doing freelance work. You might be able to get a part-time job in the service industry. These options often have few or no start-up costs and can help you make ends meet while you continue searching for a full-time job in your field. Freelancing tends to be especially flexible, and you can scale it up or down as needed.
Take Action Quickly
Ensure you don’t ignore the grace period for your student loans. Interest often continues to accrue during the grace period, so you will likely continue to owe more money before you find a job. Don’t wait for the money to go to collections, as this will negatively affect your credit score. Ignoring your debt is the worst option, and it can negatively affect you for many years if you don’t act as soon as possible.
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