Debt consolidating advice
Missing payments on your federal or private student loans can hurt your credit rating and your financial future.Missing a payment on a student loan can result in late fees, additional interest charges, and can increase the cost of repayment over the lifetime of your loan.Review your private loan contracts carefully to better understand what rights you have if you are worried about going into default. When you consider your current income, loan payments, other debt and living expenses, are you confident that you can make your full monthly student loan payments? The best way to learn about all of them is to contact your servicer.Consolidation may be a good option if you're looking to simplify your repayment process.Most borrowers on active-duty will qualify for this benefit, so it makes sense to start here.To obtain an interest rate reduction under the Servicemembers Civil Relief Act (SCRA), contact your servicer and ask about this option directly.
You can also default on a private student loan if you declare bankruptcy or default on another loan.
You will be required to provide your servicer with proof of your active-duty status in the form of orders from your commanding officer. You may also be eligible for other benefits available to servicemembers, such as military deferment and Income-Based Repayment.
Learn more about the Servicemembers Civil Relief Act and other benefits for servicemembers with student loans from the U. This is one of the best options to stay on the road to repayment for federal student loan borrowers.
WARNING FOR SERVICEMEMBERS: Taking out a new Federal Direct Consolidation Loan will impact your eligibility for an interest rate reduction under the Servicemembers Civil Relief Act.
To get started on consolidation, contact the Department of Education (1-800-557-7392) to find out if consolidation is right for you.
To begin the application process, check out the consolidation website.