Direct Student Loans

By: Evelyn Saunders

Direct loans are available to students entering college who need help paying for school. Direct loans are obtained through your school and are funded by the U.S. Department of Education. Contact your school's financial aid office for more detailed information on how to get a direct student loan. Here we will discuss repayment options for direct student loans obtained through your school.

There are a few options to choose from, but you are allowed to change your plans as your life changes. The standard repayment plan is the most common plan. It allows you to repay your loan over a period of up to ten years. The payments are fixed and easy to budget for. This is the quickest plan for repaying your loan. The payments may be a little higher because of the short time frame. But, you'll end up paying less interest in the long run and saving money.

If you can't afford the larger monthly payments and need a little longer to pay back the loan, then you may consider the extended repayment plan. This plan gives you twelve to thirty years to repay the loan. The amount of time depends on the amount of money that you owe. Larger sums of money can be stretched out to longer lengths of time for repayment. Your payments are smaller and you're taking longer to pay off the full amount, so you will end up paying more interest on the extended repayment plan.

The graduated repayment plan is a plan that assumes you'll be making more and more money after you graduate. It starts out with a small minimum payment due. Then it will gradually increase the minimum until the loan is paid off. This graduated repayment plan, like the extended repayment plan, can take twelve to thirty years, depending on how much money you borrowed.

Another popular plan is the income contingent repayment plan. This plan gives you a little leeway in your payments. You can recalculate payments every year based on how much money you're making. The more money you make, the more you will pay back. Your spouse's income will be included in determining this amount if you are married. This plan gives you a maximum of twenty five years to repay your direct student loans.

Direct student loans are meant for school expenses only. There are other types of loans offered by banks and online lenders. Your school will work with other types of lenders besides the U.S. Department of Education. You will need other forms of income for expenses associated with school, such as clothing, groceries, rent, computers and bills. If you need some assistance, shop around for student loans. Private student loans are also available and can help you through your college years. Educate yourself and find out which options will be best for you. When paying off multiple student loans or private student loans, consider consolidation. Do your research and you should have a successful student loan experience.

Student Loans
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