Understanding the best ways to repay your student loans is important.  There are currently 8 different federal student loan repayment methods. Depending on your student loan debt, income level, marital status and a few other key points making the correct choice can be difficult.

A big mistake many students make is selecting the lowest monthly payment. Not having a long term plan and knowing the impact of your payment decision could have a significant impact on future financing.  Understanding the long term impact of your debt to income ratio may limit your ability to purchase a home in the future.

The advantages to these new programs are they help the students stay current with their loan repayment.  Proper planning and understanding your cash flow options is an important part of the process.  Defaulting on your student loans is not an option.  The penalties and fees are severe.  It should be avoided at all cost.  Due to the economic down turn, many of these programs allow you to have a reasonable payment.  Additionally, student debt is not forgiven under the bankruptcy rules.

Federal loans have better loan repayment options than private loans.  The advantage if you have both is you can use the various federal methods to help you manage your total monthly payment better because of the number of options.

Consolidating your loans is normally recommended if you are just starting your repayment.  If you have been repaying your loans and qualify for certain loan forgiveness programs consolidation needs further analysis since it could impact your qualified payments toward the loan forgiveness.

As you can see this is another very confusing aspect of paying for college.  In our resource section we have a video library dedicated to the entire student loan consolidation, student loan repayment process and student loan forgiveness programs.  Proper planning is required.

Having the student loan expertise improves the information we can provide our clients in the college planning process.