How to Pay Off Student Loans: Tips Most Borrowers Don’t Know

How to Pay Off Student Loans

Repaying student loans can be a daunting task, but it’s not impossible. Even though it might seem like you’ll never find your way out of student loan debt: You will.  Here’s how to pay off student loans with some tips that most borrowers don’t know.

1. Take Advantage of the COVID-19 Forbearance

The CARES Act stimulus check isn’t the only benefit the federal government rolled out to help offset the economic hardships brought on by the pandemic. In fact, the federal government also initiated a plan to help student loan borrowers by offering forbearance on federal student loans. 

2. Apply Extra Payments to the Principal

Wondering how to pay off student loans faster? One effective way is to make extra payments toward the principal. As you earn more throughout your career, you might find that you have extra room in your budget every month. These extra funds can be a great boost when trying to repay your debt.

3. Save on Interest as Your Credit Improves

Chances are your credit might improve throughout your career as you earn more and develop an on-time payment history. Positive credit signals like this are reported to the credit bureaus and help increase your credit score. With a higher credit score, you might qualify for lower interest rates by refinancing your student loans with a private lender.

4. Check to See if You Qualify for Public Service 

Check to See if You Qualify for Public Service Loan Forgiveness. (PSLF) can be tricky since you need to make 120 qualifying payments while working at an eligible employer. Your federal student loans must also be eligible for PSLF in the first place.

5. Enroll in Automatic Payments

When it comes to saving money on interest, every little bit counts and one way to reduce your interest rate with some private lenders is by signing up for automatic payments. When you sign up for auto-pay, your monthly loan payments are automatically withdrawn from your account on your due date.

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