TUCSON, Ariz. (KOLD News 13) – As the federal student loan payment hiatus comes to an end on Jan.31, the University of Arizona’s Office of Scholarships and Financial Aid is advising borrowers to begin to plan their payments in advance.
Art Young, executive director of the AU’s Bureau of Scholarships and Financial Aid, said regardless of service providers, payments will be due again for borrowers in February. He said people need to start contacting providers now to make sure their information is up to date and their payment plans are workable.
âI think some people were sort of hoping there would be a massive loan forgiveness and it all seemed like a possibility six to nine months ago. It looks like that won’t happen in the future, âYoung said. âThe good news is that there are other financial options. With the pandemic, I would say it’s safe to say government loan departments will be as flexible as they’ve ever been because they understand what’s going on. “
Young stressed the importance of paying off loans on time. He said if you can’t afford a loan you should contact your service agent to discuss the options. Failure to pay off your student loans could lead to default, leading to bad credit and other serious consequences.
âIf you aren’t able to pay, be honest and up front with your loan service provider,â Young said. “Let them know about your situation and they can then offer you options on how to move forward without harming your credit or your future eligibility for federal student aid.”
According to a recent study published by Student Loan Hero, Arizona residents are among the most indebted federal and private student loan borrowers in the United States, with an average debt of $ 34,712.
Andrew Pentis, a student debt and education finance advisor, said the average Arizona with student debt pays around $ 265 a month. Pentis stressed the importance of budgeting to start making these payments again in February.
âYou want to make sure you have room in your budget to take care of these payments. You may need to cut back in some places or increase your income in some places. If you don’t feel able to do this, you’ll want to contact your current repairer, âPentis said. âYou can consider an income-based repayment plan that would cap your monthly contributions at a percentage of your income, or suspend your payment where interest doesn’t accrue. “
You’ll want to make sure that your account is up to date with your information. If you have any questions about the status of your loan or your repayment plan, you can contact the Department of Education. If you want to change your payment plan because you can no longer afford that amount, experts suggest calling your service agent to see what the best options are.
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