5 Essential Questions to Ask About Student Loans

During your college years, you may have heard an instructor say there are no silly questions. If something is unclear, asking for clarification is always a good approach.

For today’s student loan borrowers, this advice holds true. Student loan debt can be confusing, so it’s important to ask questions, even if they seem basic. Here are five common student loan questions that might seem silly but are actually essential to ask:

  1. Do I really have to repay my student loans?
  2. Who is my student loan servicer?
  3. How do I find my interest rates?
  4. If I can’t afford my student loan payments, can I lower them?
  5. Can I combine all my student loans?

Do I Really Have to Repay My Student Loans?

Yes. When you take out student loans, you agree to repay them. Most federal student loan borrowers have benefited from the longest payment freeze in history due to the federal CARES Act, which started in March 2020. However, this forbearance will eventually end, and borrowers will need to resume payments.

Some may qualify for loan forgiveness, such as through the Public Service Loan Forgiveness (PSLF) program. Eligibility for PSLF was expanded in October 2021, so it’s worth checking if you qualify.

Private loans, on the other hand, are handled differently, with each lender setting its own policies for repayment and dealing with late payments or defaults.

Who Is My Student Loan Servicer?

Your student loan servicer manages your loan, including processing payments. Servicers may change, and you might have multiple servicers over time. For federal loans, you can find your servicer by logging into the National Student Loan Data System (NSLDS). For private loans, checking your credit report will help you identify your lender.

How Do I Find My Interest Rates?

Interest rates for student loans depend on the type of loan, whether it’s federal or private, and the loan terms. Federal loans have fixed interest rates, which you can find on NSLDS. Private loans can have fixed or variable rates, and you can get this information by contacting your lender directly.

If I Can’t Afford My Student Loan Payments, Can I Lower Them?

If your federal loan payments are too high, you may qualify for an income-driven repayment (IDR) plan, which adjusts your payment based on your income. For private loans, while income-driven plans are usually not available, lenders may offer other options, so it’s worth reaching out to them.

Can I Combine All My Student Loans?

Consolidating your loans can simplify your payments by combining multiple loans into one. It can also help convert variable-rate loans to fixed rates. However, consolidation often extends the repayment period, meaning you may pay more interest over time. Be sure to consider how consolidation affects your eligibility for forgiveness programs like PSLF.

Understanding these key questions can help you take control of your student loan debt. Everyone’s financial situation is different, so if you need more personalized assistance, consider reaching out to a nonprofit financial counseling organization that specializes in student loans.

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