How Unemployed Graduates Can Deal With Student Loan Debt
Graduating from college is a great moment. Then real life hits and so does student loan debt. Fortunately, there are ways unemployed graduates can deal with student loan debt.
The economic situation the last few years has not been good. Millions have lost their jobs and real unemployment figures have ranged between 15 and 20 percent. If things are tough for experienced workers, college graduates entering the job market have an even tougher time finding work.
The lack of jobs faced by recent grads is only part of the problem. Student loans repayment periods start very quickly after the date of graduation. This leaves students in a tough situation as they have little in income, yet mounting bills in student loan payments. What is person to do? The good news is there are some options. Let’s take a look.
The first issue to look at is your grace period. This is the time that exists between your graduation date and the month the first payments are due on your loans. Government backed student loans tend to have a six month grace period. Private loans tend to be much shorter. Get out your loan documents and make sure you know where you stand on each loan.
The second step is to try for an income based repayment adjustment. The government recognizes the burden graduates are facing when they come out of school. The Department of Education has a program that limits your monthly repayment amount to no more than 10 percent of your income each month. If you still owe anything after 25 years, the government will excuse it.
The final step is to look at your forbearance options. Nearly every student loan comes with one. This is a period where there are no payments due on the loan, but the interest continues to grow. Most forbearance periods are for six months, but can be longer or shorter depending on the specific agreements you signed when taking out the loans.
The current job market is a brutal one and everyone knows it. The key is to not get overwhelmed. If you have student loan payments about to start and can’t afford them, figure out the options available to you. There are plenty that can be used to buy time till that great job rolls along.
