LITTLE ROCK – Students in Arkansas are in the early stages of preparing for the school year in August and some are applying for student loans. It’s important to always read the fine print and watch out for scammers who try to take advantage of unsuspecting victims. There are some key things every student should know before accepting a loan that often takes decades to repay.
“A student loan should be a short-term obligation to give students the opportunity to succeed,” said Attorney General Leslie Rutledge. “Unfortunately, these loans are too often carried over for decades and prevent our best and brightest from investing or taking risks as entrepreneurs.”
Attorney General Rutledge gave the following advice to students considering taking out a student loan:
Make sure you understand your loan. Before taking out a loan, make sure you understand the repayment terms and other loan obligations, the interest rates and how they will be applied to the loan, and where to find your balance and your post-payment schedule. ‘graduation. For federal loans, visit the National Student Loans Data System (nslds.ed.gov).
Take advantage of the grace period. Often there is a grace period after you graduate or graduate from college or university. It is important to know the length of the grace period and whether interest will be charged during the grace period. Grace periods allow you to have your feet on the ground while making a plan to pay off the loan.
Know your repayment options. Every loan is different and some offer the ability to change payment options based on your income rather than a fixed monthly amount. In some cases, if you are going through financial difficulties, it is possible to temporarily defer payments.
Beware of loan consolidation and refinancing offers. Many companies offer loan refinancing options, but may not provide the service promised or provide services that consumers can access for free. Consumers should know all the details of any loan refinance offer before signing up for an offer.
Check your credit report to see all of your student debt, including federal and private student loans.
Consider part-time work, a work-study program and all the scholarships available to keep student debt as low as possible.