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How to Relieve Yourself from Student Loans

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Getting rid of student loans, although possible, can be a rocky ride. Luckily, there are several ways you can use to speed up the process through discharge or loan forgiveness programs.

Now, the challenging part isn’t making on-time monthly payments. Instead, it’s the multiple student loan forgiveness programs, repayment plans, other alternatives offered by states, and more.

If you want to pay off your student loans, use this guide to find a program that fits your current situation.

8 Ways to Get out of Student Loan Debts

1. Income-Driven Repayment Plans

If, at the end of 20 or 25 years, you still have a loan balance on an income-driven repayment plan, it’ll be forgiven. Also, these plans can reduce your payment each month because your regular bill is capped at a percentage of your discretionary income.

However, remember that when you extend your payments to 20 or 25 years, it may cost you more due to interest in the long run. Also, any amount that’s forgiven will be taken as taxable income.

That means you’ll most definitely make one last payment before you gain your financial freedom.

2. Public Student Loan Forgiveness (PSLF)

If you work in public service for ten years, you could qualify for the Public Service Loan Forgiveness. To be eligible, you must work for at least 30 hours each for ten years in public service.

Besides that, you must make at least 120 qualifying payments each month under one of the income-driven repayment plans. Typically, you don’t get taxed when you receive loan forgiveness via PSLF.

However, the PSLF program may change in the coming years. The program is certainly not set in stone.

3. Teacher Loan Forgiveness

If you’ve been in the teaching service full time in a lower-income community school, you could qualify for Teacher Loan Forgiveness. You could have all of your Perkins loans forgiven and up to a maximum of $17,500 of a Stafford or direct loan forgiven.

4. Student Loan Repayment Assistance

You can find numerous universities and states, including some companies, who’ll be willing to offer student loan repayment assistance programs. Most (although not all) of these LRAPs are suited for professionals in specific fields such as pharmacists, teachers, doctors, veterinarians, etc.

Usually, LRAPs offer student loan forgiveness after one to three years of service. In addition, some universities provide loan assistance for qualifying alumni. But usually, they’ll have to work at a non-profit high-need area for some years before qualifying for the loan assistance.

Furthermore, employees receive student loan benefits from certain companies, which matches a percentage of their monthly payments. So, depending on where you work and live, you could be eligible for loan assistance that can help you get rid of your student loans.

5. Closed School Discharge

If your institution closed before you completed your program, you might qualify for a closed school discharge. To be eligible, you must either have withdrawn from the college less than 120 days before it shut down or be enrolled when the university closed.

If you completed your program before the school shut down and all you need is your certificate or diploma, you wouldn’t qualify for the loan discharge.

6. Total and Permanent Disability Discharge (TPD)

Are you a veteran with a disability you got from your service to the country? Are you receiving Supplemental Security Income or Social Security Disability Insurance?

If you have a medical condition that has hindered you from participating in any substantial gainful activity for the past 60 months, you could qualify for the TPD. Also, if the condition could result in death, you can be eligible for the total and permanent disability discharge.

7. Unpaid Refund Discharge

If you enrolled in an institution but withdrew along the way, the university may have to refund the remaining balance to the lender or the U.S. Education Department. If the school fails to give this refund, you may qualify for a discharge.

However, the refund will only cover the unpaid amount.

8. Discharge in Bankruptcy

First, it won’t be that simple to get a discharge in bankruptcy, but it’s possible with Chapter 7 or Chapter 13 bankruptcy. Before you can qualify, you have to start an adversary proceeding, and you can do that by filling a complete to determine the discharge.

After that, it’ll be up to you to prove that paying off your student loans will cause undue hardship. However, bankruptcy shouldn’t be your first or second resort; it should be your last.  You have to make sure you use all other student loan alternatives before you consider this option.

Conclusion

If you’re struggling to pay your student loans, you might be tempted to avoid your debts and walk away without making payments. However, ignoring your student loans won’t make the situation go away; it’ll only worsen it.

That’s because your loans will likely get into default, and that will result in dire consequences. And that could seriously affect your finances. So you need to find legitimate ways to help you get out of debt, and you can start with the tips outlined in this guide. If you don’t know what to do, it’s always advisable to talk to an expert.

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How to Prepare for a Financial Emergency: Your Loan Options

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Sudden financial emergencies can instantly leave a person feeling taken off guard and vulnerable. A sudden shift in your financial situation, whether it’s a loss of income, medical bills, or emergency house repairs, can be very stressful.

Even the best financial planning and cash management abilities won’t save you from unforeseen payments that far exceed your monthly spending allowance. So, here are some loan options to consider when preparing for a financial emergency.

Personal Loans

A personal loan provides funds in the form of a lump sum that is repaid in monthly payments, and along with paying the initial amount, you also need to pay the interest and fees. They can be used for almost anything, including vacations, weddings, home renovations, and emergencies.

And borrowers with good credit can get the best personal loans with low-interest rates and various repayment options. So, if you’re considering getting a personal loan in preparation for a financial emergency or when you need money right away, look for reliable lending sites to apply for one.

Payday Loans

Payday loans are short-term loans that allow you to borrow small sums of money, such as a few hundred dollars. Payday loans, for instance, have extremely short repayment terms, primarily within two weeks or by your upcoming payment period.

However, payday loans are widely regarded as predatory due to their exorbitant interest rates. Thus, payday loans are ideal if you, as a borrower, require small sums of money and can pay back the debt within a short period.

Credit Card Cash Advances

When used responsibly, credit cards can be valuable tools in an emergency. The cash you can borrow is your card’s limit percentage or a fixed maximum number.

And since the cash advance is linked to your existing card’s credit limit, no additional credit check is required. In addition, credit card advances are ideal for cardholders that already have active credit cards in excellent condition and need only a small loan.

Title Loans

A title loan is another emergency loan that allows you to get cash quickly. You may be eligible for a title loan without requiring a strict credit check.

It’s a secured loan that uses your vehicle title as collateral, and if you don’t pay back the loan by the end of the loan term, the lender has the authority to seize your vehicle to settle the existing debt. It’s one of the best loan options if you wish to prepare for a financial situation that needs immediate funds.

Pawn Shop Loans

A pawn shop loan is a secured loan backed by collateral, the item you bring in and leave with the pawnbroker. And while the sum you can borrow from a pawnshop depends on the item you use as collateral, the broker is likely only to offer you a portion of the item’s total market value.

Pawnshop loans mostly appeal to individuals who cannot obtain a traditional loan. So, if you cannot apply for a conventional loan, you can try a pawnshop loan whenever you need it for a financial emergency.

Small Business Loans

If you’re a small business owner or entrepreneur, you may borrow to fund your next business venture or to keep your business running. Besides, small business loans are available from credit unions, banks, and online lenders.

Small business loans are available to businesses such as hair salons, restaurants, and freelancers. So, if you’re one of them and in a financial emergency, you should consider small business loans.

Debt Consolidation Loans

Debt consolidation allows you to simplify your payments by submitting an application loan to pay off your debts, leaving you with a single monthly loan payment. And to get a debt consolidation loan that lowers your expenses, you must shop around for an interest rate lower than your credit card or existing loan.

You’re also much more eligible to qualify if your credit has improved since your last loan or credit card. When you’re eligible, your lender may pay your debts automatically or you may have to do it yourself.

Credit-Builder Loans

Credit-builder loans are small short-term loans taken out to assist you in building credit. Unlike traditional loans, they do not require excellent credit to qualify because they are marketed to people with no or limited credit.

You can find a credit-builder loan in credit union lending circles, online lenders, and Community Development Financial Institutions. A hidden benefit of credit-builder loans is that when the loan is paid off, you receive a lump sum of money that you can use for a large purchase or supplement an emergency fund.

Final Thoughts

It’s a difficult pill to swallow, but financial emergencies can happen anytime. While saving for the best times in our lives is important, it’s also essential to plan for the worst. That way, you ensure you are prepared for a financial emergency in the future.

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Tips for Saving and Growing Your Money

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You can meet your financial goals and grow wealth by saving money. Saving also helps you take advantage of emerging opportunities. Unfortunately, saving cash is one of the hardest things for most people, especially if they barely make ends meet.

Here are practical ways to grow your money.

Establish Financial Goals

Financial goals are the motivation that will cause you to save money. If you do not have defined goals, there is a little push for you to grow your money. When creating financial goals, consider the needs you want to satisfy and how much they will cost. Here is an example: If you want to start a business in two years, determine how much you would spend to start the business and add other costs. Then, determine how much you must save to start the business in the projected period.

Create one or two goals to meet, rather than many at a time. You can have many more but address each after the other. This makes it easy for you to adjust your budget while taking care of all relevant financial responsibilities.

Set Up an Emergency Fund

Before you save cash, you need to take care of unforeseen events that may wipe out your cash. This involves setting up an emergency fund. The funds can take care of unplanned visits to the vet, medical procedures, and other costs.

Setting up an emergency fund means that you will not use your credit card, savings, or any other high-interest loan to take care of unexpected costs. Remember, avoiding debt is one way of growing money. You can also earn from your emergency savings by putting the money in a high-interest-bearing account.

Make Savings a Priority

Make it a habit to put a portion of your cash away every time you get paid. It does not matter how little or much you save; you will make progress by putting it away. Therefore, make savings one of the priority activities while budgeting.

Most people with a regular standard income save the same amount every month. However, if you have a variable income, determine the percentage of the amount to save. Most people would go for between 5% and 20% of their income. Remember, the more you save, the bigger the strides you make towards reaching your financial goals. When you have fewer needs, save more.

Automate Your Savings

Most people plan to save but only end up using up all their cash when they get it. Others find their needs exceed the cash available and end up eating the savings, hoping things will be better by the next payday.

You many never have enough cash to care for all your needs and wants. Therefore, you can only save by ensuring you stash your money away as soon as you get your pay. One way to do this is by automating the savings. Many financial institutions allow you to make a standing order to have cash transferred to another account at pre-defined periods automatically. This is an easy way to force yourself to save.

Create Money to Save

You may be currently spending much of your money with little room for savings. You need to keep track of your spending and make adjustments where necessary. Find out things you can downscale or eliminate from your budget and still live a smooth life. For example, you could pay a lower internet and Netflix subscription, reduce your entertainment budget, and make dishes at home more often.

In the same breath, be wary of squeezing your budget so tightly that you struggle to make ends meet. For example, you can lower your spending at your favorite online casino to save cash, but you should not cut down on all your entertainment. Casinos like the BC Game have features that allow you to control your spending and various bonuses you can enjoy, lowering your deposits. Read the BC Game review by Vienne Garcia to know how to use it.

Avoid Spending Change if You Do Not Have To

You will get small denominations as change when you buy at stores and supermarkets. Avoid using this amount if you do not have to. Instead, consider exchanging the cash or creating a home bank where you will store the cash for use at a later date. It will surprise you how fast this amount can grow and offset some of your expenses.

Keep Watch Over Your Debt

Your debts can eat into your savings, especially if they are high-interest loans such as credit card balances. Look into ways to eliminate the high-interest loans and restructure the remaining ones so you can pay them comfortably. It is possible to save while servicing loans, especially mortgages, car loans, and other medium-term or long-term credit facilities.

When paying loans, you can start with the higher-interest and then work on bigger loans. Always look for ways to pay more than the minimum amount to reduce the duration you can complete your loan repayments. You can also merge loans into one that has better repayment terms and lower interest. Several lenders offer the facility across the country.

Bill Payment Automation

Most utility companies charge you for the late repayment of bills. Some of the bill repayments get late because you forgot to pay. You can avoid this by automating bill payments. Most financial institutions have features that allow for automatic bill payment and alerts when the payment is due.

Saving money involves financial discipline, commitment to your goals, and a conscious effort to grow money. Save as much as possible wherever there is an opportunity, cut unnecessary expenses, and avoid using the savings until you have saved enough to meet your goals. The abovementioned tips will help you grow your money.

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How You Can Avoid Credit Cards That Have Red Flags

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When you are searching for a credit card, you may examine multiple types of red flags, and you could avoid credit cards that have a high interest rate, extra fees, inflexible terms and a low credit limit. Before you submit an application, you could also evaluate the reputation of the lender. You may read many testimonials that describe the lender, the features of the credit card, the rewards and the experiences of customers.

Estimating the Fees

Some credit cards may charge substantial fees, and if a credit card requires an annual fee, you may avoid that credit card. Once you review the terms of the contract, you should examine the fees, the benefits of the credit card and the policies of the financial institution. Subsequently, you could obtain a credit card that does not charge fees, and this credit card may consistently reduce your monthly payments.

Determining the Interest Rate

Before a lender provides a credit card, the company could examine your credit score, the unused credit, the debt and the open accounts. Afterward, the business can quickly determine the interest rate of the credit card. If the credit card has a high interest rate, you may search for other credit cards, and you could select a credit card that provides a better interest rate, multiple incentives and online tools.

Reviewing the Terms of the Credit Card

While you review the terms, you can examine the company’s policies, the fees, the due date of the payments and the rewards. Some credit cards could also provide a cash advance, yet once a customer obtains a cash advance, the company may charge extra fees. Usually, you should avoid a credit card that has inflexible terms, and you could find credit cards that can provide cash advances, low fees and flexible terms.

Examining the Rewards

Some credit cards may provide incentives that can help you to save extra money. Once you make a purchase, the financial institution could automatically offer cash back, and after you access your online account, you can estimate the value of each reward. The company may also offer tools that will allow you to monitor your credit score. If a credit card does not provide substantial rewards, you may search for another credit card, and you could obtain a credit card that can reduce the interest rate, offer valuable rewards, consolidate several types of debt and decrease the monthly payments.

Comparing Many Credit Cards and Submitting an Application

Lantern by SoFi has designed a marketplace that can allow the customers to compare multiple types of credit cards. The borrowers may examine each lender, the benefits of the credit cards, the interest rate and the credit limit. Once the customers compare credit card offers, the borrowers could also find many credit cards that do not charge fees, and the customers can select credit cards that will help the borrowers to consolidate debt. Before a borrower submits an application, the company might prequalify the customer. Subsequently, the borrower could submit an application, examine the terms of the credit card, receive multiple incentives and utilize the credit card.

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