Student Loan Repayment

If you are having trouble paying for your education, waiting it out is
not an option. There is no statute of limitations on government-
guaranteed student loans, giving Uncle Sam unlimited time to collect.
Fortunately, there are some options.

Telemarketing fraud caused losses of more than $1.7 million in 2003.
Total Internet fraud losses equal more than eight times that figure.
Obviously, you should steer clear of get-rich-quick schemes and
suspicious "contests." Unfortunately, thieves adapt as consumers
become educated; fraud has seeped its way into more trustworthy covers
including "charities," credit repair, loans, travel, online auctions
and work-from-home offers. Following are some ways to foil fraud:



-Consolidation. You may be able to consolidate several loans into one.
Many consolidation loans offer students the opportunity to repay their
loans over a 30-year period at a favorable interest rate. While
consolidating your loans may decrease your monthly payments, keep in
mind that increasing the length of time it takes you to repay may
increase the total cost of repaying your loans.

-Deferment. You may request a deferment, or temporary suspension, from
your lender if you meet certain criteria such as being unemployed or
re-enrolled in school. If you have a subsidized Federal Family
Education Loan (FFEL), Direct Stafford Loan, or a Federal Perkins
Loan, you do not have to pay interest during deferment. However, if
you have an unsubsidized FFEL or Direct Stafford Loan, you must
continue to pay the interest. If you apply for a deferment, you must
make all payments until it is granted; you can't get any deferment on
a defaulted loan.

-Forbearance. If you are not eligible for deferment, you may request a
temporary suspension or reduction of payments. Forbearance can also be
an extension of the time you have to repay your loan. Unlike
deferment, interest accrues, and you're responsible for repaying it,
regardless of the type of loan you hold.

-Cancellation. Perhaps every student dreams of having their loans
dismissed and, in some rare cases, it is possible. For example, your
student loan may be cancelled if you become permanently disabled or if
your school closes before you complete your program. Keep in mind that
cancellations are not granted for financial difficulty.

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