Most people pay back their student loans in the same way as they pay their Income Tax. You will not normally have to make any repayments while you are studying. You start repaying the student loan after you leave your course, get a job and are earning over a certain amount (in other words, the repayment is income-contingent). How quickly you repay your loan will generally depend on how much you earn.
The first step is to find out how much you owe and to whom. Your financial aid office can help you with this. You may feel overwhelmed by your loans and wish that they would just go away. Actually, there are a few ways that they can be diminished without you paying them, but these are special cases. Most of us are going to pay back every dollar we borrowed. Student loans are not commercial loans. The government subsidies the actual cost of interest on the loans, so they do not attract the same rates of interest as a loan from a bank or building society. You can get more information at www.LoanAndFinance.visainfo4u.com
Interest on the amount you owe will be linked to inflation – in line with the retail price index (RPI) – so the value of the amount you pay back will be about the same in real terms as the value of the amount you borrowed.
This will apply as long as the loan lasts and will include any time when you are not studying or not repaying the loan, as well as when you are repaying the loan.
Borrowers do not have to start paying the interest or principal on their part-time student loan until six months after they complete their studies.
However, since those loans are from the federal government, interest will accrue while they are in school and during the six month grace period. Once you are no longer studying (e.g., you have graduated or left school) you have 6 months from that date before you must start repaying your student loans. Even though no payments are required during the grace period, interest will continue to accrue.
This entry was posted by Rokhim on January 31, 2012 at 3:20 pm under Student Loan. Tagged Loans, Repaying, Student. Both comments and pings are currently closed.
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