When college is over, we come to the cruel world, where things would be totally dependent on your decisions. At the time it can become much difficult if you not pose skills to deal it. The biggest problem one probably faces after college is repaying their student loan debt. Many of us make costly mistakes while the procedure of taking loan and hence get in the turmoil of a bigger financial crisis. Loans are an instrument which helps us to come out of some financial dig but sometimes it creates a much bigger one, if mishandled especially unsecured loans like student loans.
Here are some tips to consider in case of student loans
Know your loans
The first step towards any loan is to have deeper understanding upon the loan. The basic questions to know is that how much you owe i.e. how bigger amount you can get from your lender. The second question is how much you have to repay and under what circumstances. Basically, banks or private lender don’t have fixed interest rate, it all depends on your credit history. If your credit history is good then you probably get lower rates. So, it’s better to know all the things before.
Considering income-driven repayment plans
The newest in the market is these plans which can be beneficial for everyone. Traditionally, borrowers opt for those loans which have fixed EMI, need to pay all along for the total time tenure. There is no consideration in EMI, under any circumstances. But, income driven payment works completely different. This allows you to submit information about your monthly income and family size and according to that, EMI is adjusted. So, it is better to have knowledge about such plans.
Try to save for future
The biggest common mistake a borrower does in his/her college days is not saving money for paying interest. It is something which is dependent on your moral science. Loans are money which you borrow and certainly you have to pay it afterwards with interest. Try to utilize the money only on your necessary expenses of college like books, fees etc. Be focused and think twice before spending every penny. Save extra money for interest payment which is helpful in long way.
Keep in touch with your bank
This is the common silly mistake committed by most of the borrower. Once you get the money on your hand for studying, and you reach college, just don’t ignore your lender. Always keep them in touch and talk about different schemes. Inform them if you change your address or phone number. This would give you few benefits such as you will get updates if any change in rules occurs by RBI related to loan rates. Also, your lender would feel secure and trust you more.
These above are few things which need to be considered in student loans. Also, choose good banks which have the best student loans or you could also opt personal loans from HDFC Bank Personal loans or PNB loans, which offer the best rates and can serve your educational needs as well.