What do I do about student debt?

Question

Okay so here it is. I just graduated college with a huge amount of debt. The problem I have is not including the federal loans and and one private loan. I have two credit cards. One with $1700 and the other has like $5700. It was stupid at the time to use these credit cards to pay for books/tuition/rent/spring break but now its all added up and I can barely keep up with the minimum payments. the $5700 one has a minimum payment of $150 so as you can see its getting desperate. I don't want to open another card and try to transfer it b/c I've already done that once and I don't want it to hurt my score any more. What is everyone's suggestion?

Answer 1

get two jobs and forget about any spring-break type vacations until you get them paid off - I wouldn't worry abot your score right now - if you can get a new card with a low rate to payoff a higher rate card - do it, then lock the old card away for emergencies only or cut it up if you don't trust yourself

Answer 2

Student loan lenders will work with you a lot more than credit card companies will.
1. Consolidate the student loans. Lengthen the repayment time to lower the payments.

2. If you absolutely can not make any payments on the student loans right now, you can ask for a hardship deferment. This will delay the repayment but more interest will stack up on the total.

3. Do everything you can to pay off the credit cards since they undoubtedly have a higher interest rate than the loans. Work overtime, pick up a second job, have a yard sale, etc.

4. Work out a budget and stick to it. Slash all unnecessary expenses like eating out, partying, travel, clothing shopping, etc. Clip coupons and buy things on sale. Do you have both a cell phone and a home phone? Could you live without the home phone? Sit down and make a list of every single bill you pay. Try to eliminate as many as you can. Cancel your Netflix if you have movie channels on your cable, for example.

5. Call the credit card companies and try to negotiate a lower interest rate. Sometimes they will, sometimes they won't. Doesn't hurt to ask.

6. Credit card interest is applied on a daily basis. If possible, make your payment prior to the due date. You can even send in a partial payment one week and the rest the next week. This lowers the average daily balance that interest is calculated on.

7. You have a degree.....get a good paying job. $150 a month isn't really that much compared to the average new grad salary. Ask your boss for a raise!

It will suck for a while. Every time you get the urge to spend money on something non-essential, remind yourself of the interest you are throwing away on the credit cards. I kept a spreadsheet of my cards and balances. It was nice to see the balances going down each month. The amount of money I was spending on interest each month was awful!

Student loans can no longer be discharged in a bankruptcy so you are going to have to pay them sooner or later. Get rid of the high interest consumer debt first (credit cards) and then tackle the student loans. Student loan debt is not quite as damaging on your credit report as credit card debt.

Answer 3

Get two jobs and make yourself a strict budget. Eliminate all the extras -- cell phone, new clothes, eating out, vacations, etc. Put every penny you can squeeze out of that budget on the highest interest debt, while paying minimums on the rest. Once the highest interest rate is paid off, move to the next one till they are all paid off.

You should be able to pay off those credit cards within a year or so and can start on those student loans. The sooner you get that debt cleared up, the better.

Answer 4

Student consolidation loan involves converting the loans taken by the students or parents into a single big loan from one lender. They are available as FFELP, FISL, Perkins, HEAL, Health Professional Student Loans, NSL, Guaranteed Student Loans and Direct loans. Few of the lenders let you consolidate these loans as private loans.

You pay lower monthly installments since the duration of these loans is more than 10 years. Usually, these loans last for 12-30 years according to the amount borrowed.

Answer 5

If a person has accumulated a large amount of credit card debt due to multiple credit cards, the need for a proper counseling for credit card debt consolidation can't be understated. Credit card debt consolidation counseling helps a person get vital insights into the facts that can help him get control over the credit card debt.

Credit card debt consolidation counselors are experts with a good knowledge of debt management, budgeting and behavioral patterns of credit card holders. These services are vital for those struggling to manage their credit card debts. Also called credit counseling or debt counseling the credit card debt consolidation counseling brings immediate relief to a credit card holder.

A person seeking credit counseling can get it from two types of organizations. The professional or commercial organizations, and the non-profit organizations. As depicted by its name or categorization, the commercial organizations charge money for their credit counseling sessions and consolidation help on the other hand the non-profit organizations offer free of charge services. Just because the non-profit organizations are free, it doesn't undermine their quality of service. The persons associated with such organizations are thorough experts and have lived the trauma of being under credit card debt themselves and hence bring their vital experience to the credit card holder. Read more from: http://www.credit-card-gallery.com/article/353,Credit_card_debt_consolidation_and_credit_counseling_great_tools_to_get_rid_of_credit_card_debt