Drowning in Student Loan Debt? Here's Help
September 5, 2012
Millions of college graduates and dropouts are struggling to pay off a total of over $1 trillion in education debt, according to the Student Loan Debt Clock. College seniors who graduated with student loans in 2010 owed an average of $25,250, up 5 percent from 2009. The U.S. Department of Education found that over 320,000 borrowers had defaulted on their student loans as of September 2010, meaning they were at least 360 days late in making their payments. For those looking to pay off their loans, the Student Debt Repayment Assistant on the Consumer Financial Protection Bureau (CFPB) Web site can help students and families find the best repayment options. The site also features a link to the National Student Loan database so that students can determine what kind of loans they have. “Options vary by lender, but many private student loan programs offer borrowers a partial forbearance during which the borrower makes interest-only payments for a short period of time until the borrower can get back up on his or her feet,” said Mark Kantrowitz, publisher of FinAid.org and Fastweb.com. “This keeps the loan balance from growing bigger and digging the borrower into a deeper hole.” The CFPB also recommends that students first take advantage of all federal loans available to them before applying for private loans, particularly those with variable rates.
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