The Four Types Of Direct Consolidation Loan Repayment Plans For Student And Working

Debt-Consolidation If you consider student loan is a very convenient way of funding your studies, you must also consider how you are going to pay it back someday. Getting ready to pay it back strategically is important and you must be prepared for it. You may consider Direct Consolidation loan as this option is available to you whether you are a student or already a working adult. The following paragraphs will review the different types of payment plans and benefits for Direct Consolidation Loan. An obvious advantage is that of simplification, if you have several different student loans. Every month all the repayments can be made under one single payment by uniting them together. This provides the borrowers an easy and convenience way to clear their debts on time without worrying to schedule different payments at different time. Borrowers can opt to choose any one out of four different payment plans, half of which will take into consideration your actual or expected in.e. It does not matter whether you have graduated or not, students can still take advantage of Consolidation Loan. have In fact, if you choose to bring your debts together under this type of credit, you can be granted more attractive terms, such as a lower interest rate – up to 0.6% lower than for people who only refinance after they have graduated. Standard Repayment Plan The Standard Repayment Plan has a maximum lifetime of ten years and borrowers are required to pay a fixed rate of at least $50 per month. This plan benefits people with higher in.e who can afford higher repayment with its ten years term, the shortest of all plans. For instance, 8.25% of interest for $15,000 of loan over 10 years will total $22,077 if you pay $184 per month. Total interest is only $7,077. This is considered the lowest interest of all the plans due to the short term. Extended Repayment Plan Under this plan, borrowers are allowed to extend the term between 12 to 30 years with the same minimum payment of at least $50 per month. Depending on the amount of debts, the repayment term varies accordingly. This plan benefits peoples who have just started building their career, thus reflects a lower fixed payment and don’t mind the higher interest paid over a longer period. The same $15,000 loan will total $26,196 with $146 of fixed repayment for 15 years. Higher interest than the Standard Plan for 15 years. Graduate Repayment Plan The third plan is Graduate Repayment. This plan has similar lifetime as the Extended Repayment Plan but the payments are not fixed throughout. It usually starts with low payments and increases over time, every two years. This plan benefits borrowers with lower in.e and increases payments over time to avoid financial difficulties when they are just started building their career. Under this plan, borrowers are expect to pay more interest than the Extended Repayment Plan but may seem to be a good option for some people. In.e Contingent Repayment Plan This plan takes into account the borrower’s family size and annual Adjusted Gross (AGI) to decide the monthly payments with maximum of twenty five years. The flexibility of this plan enables borrower’s to avoid any financial hardship by adjusting the payments accordingly to their in.e annually. This article will provide a simple understanding of direct debt consolidation loan although there are more to know when it .es to .plicated interest rates calculation. About the Author: 相关的主题文章:

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