Whether you are a current student or a former student trying endlessly to pay off your student loans, it can get really overwhelming at times. Most people, when they sign up for college, don’t fully understand the amount of debt they are about to endure. The loans that you take out must be repaid, typically within 10 years, along with interest. So the main question here is how can you pay off these loans quickly and efficiently? Let’s look over some of the ways you can do this.
Make Extra Monthly Payments
While it seems quite simple, one of the easiest ways to pay off your loans quickly is to make extra payments monthly. This may not always be feasible for everyone, but there are smart ways to do so. With that, there are absolutely no penalties for making payments larger than what you owe. So, if you decide that you can pay a little extra each month, you may be able to pay off the entire loan years ahead of time. It’s also important to note that you don’t have to make one large payment each month. Small, periodic payments throughout the month also work just fine if you want to expedite your loan.
Refinancing Your Loans
You may or may not be in a good position to refinance your loans. Typically, if you are working full time and have student loans with high interest rates, this is a great option. When you refinance your loans, you are basically taking multiple student loans and replacing them with a single private loan. Most of the time, this lowers your interest rate. If you have unsubsidized direct loans or loans with high-interest rates, you may want to look into refinancing. This is another great way to pay off your loans quicker than normal. Not all companies are the same, so make sure to explore different options with a Sofi bank account to make sure you find a deal that will work for you.
Auto Payment Plan Enrollment
Perhaps you aren’t a very good candidate for refinancing your loans. In this case, you can lower your interest rate by enrolling in an auto-payment plan. Although it’s not that big of a difference, you can still expedite the length of your loan by a little bit. In fact, this option may help you save a couple hundred dollars. Most federal student loan services offer lower interest rates if you are enrolled in an auto-payment plan. This will pull your payments directly from your bank account each month so you don’t have to worry about paying it manually each month.
A lot of people have student loans that need to be paid off. If you are struggling with this process, look for ways that you can lower your interest rates and pay off your debt quicker. Making extra monthly payments, refinancing your loans, and enrolling in an auto payment plan are all great ways to pay your loans off in a shorter amount of time. It’s important to do your research in order to find a plan that works best for your finances.