Consolidating Loans / Starting Payments - Help Plz

[Deferoxamine]

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I have 2 weeks (give or take) until that magical 6 month deadline. True to typical Deferoxamine fashion, I have COMPLETELY put everything about this off as long as possible.

No time for constructive criticism, plz. My daytime is very limited (busy service in residency right now) and I need to know how to take care of this as efficiently as possible.

Little bit about my situation:
-- Current debt <$100K
-- I borrowed from a lender for the first year, then the economy tanked and I had to start borrowing from the govt or something like that (2 lenders, I need to consolidate?).
-- Never did GRAD Plus Loans
-- I have already paid off a nice chunk of this debt in check payments... but I have not set up one of those schedules like "Each month, I will pay X number of dollars minimum."

Seriously, anyone have any ideas of where to begin? Thx/adv.

 

[Lesley]

If you are saying you have a private student loan and federal student loans, you can not consolidate them. With under 100K in loans, see if you can afford the lowest federal loan repayment plan, 10 yr, and find out the available terms from your private loan lender.

A short length of repayment significantly effects the amount of interest on debt often more than the interest rate. Determine what payments are doable based on your income. Can you afford the shortest repayment plan for each?

Also consider the interest rate and amount of debt on each note, if one is at 7% and the other is at 4%, you would be saving considerable interest if you repay the higher interest note first.

Also consider the total amount of each loan. If the private loan is $20,000 and the federal is $80,000 and you have chosen the shorter repayment plans for each, is it possible, if you have extra cash, to pay off the smaller note first and retire that loan? That would be one monkey off your back and give you considerable satisfaction.

Some people would say to bank any extra money for a future mortgage, car purchase, but to me that is just leveraging money to incur even more debt. It is not something I would choose, but how anybody pays back their loans, ultimately, is a very personal decision. There are lots of ways to do it.

Good Luck.

 

[shantster]

Also consider the total amount of each loan. If the private loan is $20,000 and the federal is $80,000 and you have chosen the shorter repayment plans for each, is it possible, if you have extra cash, to pay off the smaller note first and retire that loan? That would be one monkey off your back and give you considerable satisfaction.

That is one thing that I disagree with. In theory, it does feel better to actually finish something, but I would not do that if the loans are like the standard private vs. government rates. I took out private loans for undergrad since I did not need that much money. The rates on those are at 3.25% compared with 6.8% for the federal loans. Always always pay off the higher interest loan first with extra money. You'd be paying an extra 3.55% interest on that amount for no reason.