Student loans are one of the most common debt sources for college students and professionals, but here’s the curious thing: usually, you can’t borrow money again until your loan is paid off. But what happens when your student loan account is paid off?
When Can You Borrow Money Again?
You can borrow money for the first time again when you turn in your loan application and it is approved. The application process can take up to three weeks. If you applied before July 1, 2016, an extremely difficult new process was put into place. If you applied after July 1, 2016, then they will process your loan without any trouble.
There are some repayment options that may help you to pay off your student loans faster. These options include deferment, consolidation, and income-driven repayment plans. For example, if you are not making a lot of money now but plan to be in the future, it might seem like a good idea to consolidate your loans with a federal loan so you will have a more manageable monthly payment.
Why Does This Happen?
When Student Loans Resume it happens because a student gets kicked out of school or drops below a certain GPA. The loan is put on hold for 6 months and then resumes when the student starts receiving financial aid.
After graduating, you may be curious as to what happens with your student loans. Student loans can be confusing because they are not like other loans that are paid back over time. Instead, student loans are unique in that the money is due at one point during your repayment period- either when the loan was signed or when the loan was approved. In 2016, about 5 million Americans were in default on their student loan. This blog helps answer that question.
The Good, the Bad, and the Ugly of Loan Repayment
So now that you are an educated person and you have a job, what should you do with your student debt? This blog explores some of the benefits, challenges and pitfalls of loan repayment.
The good news is that student loans are finally being forgiven. The bad news is that student loans will resume payments in October and then every six months after that. The ugly news is that student loan repayment can be a financial burden.