Category: Education Loan

Anyone seeking a loan or other type of credit, whether it’s a home loan, vehicle loan, personal loan, business loan or education loan, must have a credit score of 750 or above. Nonetheless, many lending institutions examine the credit report and credit notes in addition to the credit score. Any unfavourable information on a credit report will have a detrimental impact on the borrower’s ability to obtain a loan. It also lowers the possibilities of obtaining a fast loan. In this blog you will get to know more about credit score vs credit remarks.

What Are Credit Score Vs Credit Remarks?

A credit report is only a statement of a person’s financial actions. It could also be a single word, such as ‘written off.’ It is based on your payback history for loans and credit card payments. Some lending companies are interested in more than just a good credit score as credit remarks are equally important to them. If a negative remark on your credit record is discovered, the lender may reject your loan application. It is necessary to have a strong payback history as well as a decent credit score in order to acquire the finest loan and credit card offers.

The Most Common Form Of Credit Remarks

“Settled”

This credit remark appears on the report in case you have partly paid the dues or settled a loan or any of the credit card dues with the lender. The status after settling appears as ‘settled’ in your credit report. Having this remark in your credit report leaves a negative impact and creates hassles in getting a credit application approved as per your expectations in terms of interest rate.

“Written-Off”

When you find it difficult to make loan repayments and no payments made from the past 180 days. In that case, the status that appears on your credit report is “written-off. It is known as a detrimental status related to your credit card or loan applications.

“Post-Write Off Settled”

This happens in cases of debt settlement after the written off of outstanding dues. It takes place after 180 days of non-payment. If you are making partial payments of outstanding dues, your credit report will reflect the same status. Having these credit remarks will leave a serious impact on credit score and damage credit status. Avoid having such credit remarks to get a quick and best-in-class loan and credit card offers.

“Willful Default”

Any default mark reflecting in the credit report indicates non-payment of loan EMIs. A willful defaulter is the one who is intentionally making loan defaults despite having sufficient funds to repay the loan amount. This scenario is quite different from the ‘write-off’. If the borrower is not making use of the sanctioned loan amount. They are considered a willful defaulter and use the funds for any illegal activities.

“Closed”

This credit remark on the credit report means you have made the loan payment fully, and the account stands closed. Make sure after closing the account, the lender provides you with the no dues certificate or closure letter stating that the loan stands closed from the end of the financial institution. Within 45 days, the ‘closed’ status will start reflecting on your credit report.

How To Remove Credit Remarks Available On The Credit Report?

Borrowers grow anxious when they see derogatory credit marks on credit reports. But there’s no need to be concerned. Obtaining a credit report from each of the bureaus is the greatest way to work on credit remarks. After that, emphasise the credit report’s good parts. If you discover any errors on your credit report, contact the credit reporting agencies to file a dispute. Never forget to include supporting documentation if the credit report contains incorrect information. If the credit remarks are real, you might write the agency a goodwill letter from a different perspective.

Now’s the right time to secure a safe education loan! Fill the form in this blog TODAY!

Common Types Of Errors Available On The Credit Report

1. Identity-Related Errors:

• Identification of mistakes like phone number, address, PAN number, or incorrect name.
• Mixing of identity with someone else having the same name.

2. Account Related Errors:

• When a closed account is reflecting open.
• Account not showing.
• The Incorrect account is looking like the default.
• Incorrect date of EMI payment or incorrectly showing late payment.
• An account listed more than once with different creditors.
• Showing old accounts or errors related to balance.

Usually, the negative credit remarks like missed payment, late payment, settled, or post settled written-off remarks are reflected in the credit report for seven years.

How Is The Credit Score Generated?

Here are the main factors that are taken into consideration while computing the credit score:

• Payment History: 35%
• Credit Utilisation: 30%
• Credit History Length: 15%
• Credit Mix: 10%
• New Credit: 10%

Credit Score Vs Credit Remarks: What Matters More? 

As previously mentioned, you have read the credit score and credit remarks individually in order for you to grasp the significance of both words in obtaining a loan or credit card approval. Please keep in mind that your credit score is important even if you have no credit history. This score is a numerical representation of a borrower’s financial trustworthiness and repayment capabilities.

The credit score is a straightforward way of understanding creditworthiness in comparison to studying credit remarks mentioned in your credit report. If the lenders want to decide the terms and conditions of loan approval, the lender always checks credit score first.

PS: If there’s anything more you’d like us to know about. Add it to the comments section!

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When is the FAFSA due for fall? Well, to be eligible for grants, scholarships, federal employment i.e, work-study, and federal student loans, you must complete the Free Application for Federal Student Aid, or FAFSA for international students, for each academic year.

However, federal, state, and institutional aid deadlines differ. The 1st of October and the 30th of June are the two most crucial dates to keep in mind. 

When Is Financial Aid Due?

School Year	Open Date	Deadline
2021 – 2022	Oct 1, 2020	June 30, 2022
2022- 2023	Oct 1, 2021	June 30, 2023

When Is The FAFSA Due For Fall Next Year & When Should I File It?

The FAFSA application opens every year on October 1st. To increase your chances of receiving the greatest grant, scholarship, and work-study aid, submit your FAFSA as soon as possible after October 1st. On October 1, 2020, applications for the 2021-22 academic year opened. The start date for the 2022-2023 academic year is Oct. 1, 2021.

Certain types of help, such as federal work-study funds and many state and institutional grants and scholarships, are given to students who apply first.

Now’s the right time to secure a safe education loan! Fill out the form in this blog TODAY!

When Is FAFSA Due For Spring?

Students have until June 30 after the school year in which they desire aid to file the FAFSA — for example, June 30, 2022, for the 2021-22 school year or June 30, 2023, for the 2022-23 school year — to do so.

However, you must submit the form much earlier in order to satisfy your state’s and college’s financial aid requirements and get your aid funds in enough time for the start of the school year.

To be qualified for all three types of help, you only need to fill out the FAFSA once. Here’s everything you need to know about each of them.

When Is The FAFSA Due For State & Institutional?

State: Individual states and institutions set their own FAFSA deadlines, which are usually far sooner than the federal deadline. To be considered for state and institutional vocational scholarships and grants, you must submit your request by these deadlines.

You may not qualify for state help if you attend an out-of-state institution; check with the state to see if you do. On the Federal Student Aid site, you may find out when your state’s financial aid deadline is.

Federal: Each year, the federal deadline is the last day to submit the FAFSA. You have until June 30, 2022, to apply for financial aid for the 2021-2022 school year.

Work-study funds and most government and institutional help will be the first to run out, but government funds and student loans will still be available.

You can get these grants and loans retrospectively to reimburse what you’ve already spent for the spring and autumn semesters, even if you wait until June 30. Alternatively, depending on your institution, you might be able to use the cash to pay for summer school in 2022.

Now that you know when is the FAFSA due for fall and other seasons, let us see some following steps ahead:

Following Steps:

Track University’s Funding Deadline: Keep track of financial assistance deadlines at institutions. Individual school priority deadlines are generally the earliest, thus they are the most critical to keep track of. Those dates are also the ideal opportunities to receive the most assistance. Look up the deadlines for all of the colleges you’re considering applying to and write them down in one place – your phone’s calendar, a notebook, or a diary dedicated to your college search are all good options.

Fill out any other financial aid applications you may have: To qualify for state or institutional help, many institutions require supplementary or alternative financial aid submissions, such as the CSS Profile. To be considered for financial assistance, you must submit all needed papers before the deadline.

You can make modifications in your form: After you’ve submitted your FAFSA, you can make modifications. You can edit the FAFSA if you find an error or if you need more aid due to a change in your family’s finances. Sign in to fafsa.ed.gov, then click “Make FAFSA Corrections” on the “My FAFSA” tab, input your FSA ID, make changes, and resubmit your application.

Above all, keep October 1 in mind: Although it isn’t a deadline, submitting your FAFSA soon after that day will ensure that you cover all of your bases.

Should you apply for FAFSA before applying to any college?

Yes, you should apply for the FAFSA as soon as it becomes available, even if you haven’t applied or been approved by any universities yet. You only have to name one of the universities you’re contemplating applying to when you first fill out the FAFSA, but it’s ideal to include all of them so you don’t miss out on any financial help. Later on, you will be able to add colleges.

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The cost of higher education abroad is a key element that dictates the sort of course a student enrols in, as well as the university they choose. The best way to fund your international studies is to take out an education loan. Various financing options are available from Indian banks, depending on the institution and degree of study. 

Most education loan schemes come with flexible repayment options and allow the borrower to plan his/her finances accordingly. Education loans have a moratorium or holiday period, which is highly advantageous since it gives the borrower a time of about six months after the course is completed. Indian banks allow the education loan repayment to be started after this period or as soon as the borrower has found a job. Students can find education loans that cover 100% of their expenses. This includes the cost of boarding, student accommodation, tuition fees, travel and other related costs for the student.

Before we answer the question – Which Bank Is The Best For Securing An Education Loan? Let’s take a look at the salient features of education loans:

• Anyone between the ages of 18 and 35 can apply for an education loan to study at any authorised university overseas.

• Management courses, engineering courses, medical, graduate and postgraduate degrees, arts, architecture, pure science, hotel management, and other courses are all eligible for education loans.

• Tuition, exam costs, lab and library fees, caution deposit, travel, books and equipment, projects, and study tours are all covered by an education loan.

• For loans obtained for overseas education, borrowers must put in a margin of 5 % – 15%.

• During the moratorium period, borrowers have to pay the interest, with the principal payment starting when the loan tenure begins.

• Education loans can be repaid in monthly instalments through ECS or via post-dated cheques to the bank.

• Generally, banks sanction education loans with tenure of up to seven years, inclusive of the moratorium period.

• A co-applicant has to be selected for education loans taken for full-time courses. Co-applicants can include siblings, spouse, parents or other family members.

• Generally, no security has to be submitted for education loans taken up to Rs. 4 lakhs. Third-party guarantee has to be furnished for loans between Rs. 4 lakhs and Rs. 7.5 lakhs and tangible collateral security is required for loans above Rs. 7.5 lakhs.

• The Central Government has also introduced an interest rate subsidy scheme for repayments done during the moratorium period for the benefit of the weaker section of the society.

Let’s outline your eligibility to secure education loans! Fill the form in this blog!

Top Banks For Securing An Education Loan 

HDFC Credila 

HDFC Credila is the country’s first dedicated education loan provider. HDFC Credila has spent time and money over the years to establish suitable systems, procedures, and know-how in the education business, and it has a number of databases on the subject. HDFC Credila Financial Services provides education loans to study abroad aspirants from more than 1,000 universities across at least 35 countries.

HDFC Credila Education Loan Features – 

Sr No.	Features	HDFC Credila Education Loan Details
1)	Education Loan Amount	Minimum Loan Amount – INR 1 LakhMaximum Loan Amount- INR 40 lakhs (without collateral)Exceptional cases – up to 1 Crore
2)	Interest Rates	11% to 12.5%
3)	Margin Money	NIL; Finance up to 100% of the expenses
4)	Processing Fee	1 % to 1.25% of the loan amount
5)	Loan Tenure	Up to 10 years
6)	Prepayment Charges	NIL
7)	Repayment Holiday	Interest to be paid during the moratorium period; EMI starts after the completion of course + 6 months
8)	Countries Covered	More than 35 countries including the US, Canada, France, Ireland, Dubai, Germany, Australia, Singapore
9)	Payments During Study Period	Yes, simple interest; For selected good profiles, partial interest repayment is available.
10)	Processing Time	3-4 working days after documentation

Axis Bank

Axis Bank was founded in 1993 and operates as an Indian private sector bank that offers a wide range of financial services. An Axis Bank Education Loan can help you finance your international studies at extremely low interest rates. Students may now achieve all of their scholastic ambitions with education loans starting at Rs. 50,000 and low-interest rates. Axis Bank Education Loans promise easy documentation, rapid loan disbursement, tax benefits under section 80(E), lengthy payback terms, and more. 

Features Of Axis Bank Education Loan –

Sr No.	Features	Details
1)	Loan Amount	Rs 50,000 – Rs.40 lakh (without collateral)
2)	Axis Bank Education Loan Interest Rate	The exact rate depends on your profile but typically 11% -13% for loans without collateral given to Prime A and B programs. Higher for non-prime programs. Lower with collateral.
3)	Processing Fee	For Loan up to 20 Lakhs, Rs. 15,000 (refundable) + GST.For Loan more than 20 lakhs, 0.75% of (Loan Amount – Rs. 20 lakhs) + GST (Non refundable).For Example, for a Rs. 21 Lakh loan: 0.75% of (Rs. 21 lakh – Rs. 20 lakh) = Rs. 750 +GST.
4)	Loan Tenure	20 years
5)	Margin Money	No Margin up to Rs. 4 Lacs, 5% Margin above Rs. 4 Lacs for studies in India and 15% Margin above Rs.4 Lacs for abroad studies.
6)	Moratorium Period	Course length + 12 Months.
7)	Payments during the study period	Full Interest (SI)
8)	Processing Time	7 days.

Bank of Baroda

The Bank of Baroda was founded in 1908 and is one of India’s oldest banks. BOB provides a variety of local and international services to its retail and business customers. For many years, the Bank of Baroda’s BOB Education Loan has helped thousands of students realise their aspirations of studying overseas. Female students receive a 0.5 percent interest rate reduction through the BOB Education Loan. Also, being a scheduled commercial bank, Bank of Baroda provides various interest subsidy schemes such as Central Scheme of Interest Subsidy (CSIS) for Economically Weaker sections, Dr Ambedkar Central Sector Scheme of Interest Subsidy for abroad studies for Other Backward Classes and Economically Backward classes & Padho Pardesh interest subsidy Scheme for minority communities.

Features Of Bank Of Baroda Education Loan – 

Sr No.	Features	Details
1)	Maximum Loan Amount	Listed Universities: Rs.80 lakhUnlisted Universities: Rs.60 lakh
2)	BOB Education Loan Rate of Interest	Listed Universities: 8.1% for boys, 7.6% for girls, Unlisted Universities: 8.85% for boys, 8.35% for girls.
3)	Processing Fee	Rs.10,000 + GST (Rs.10,000 refundable); In case of Real Estate collateral, additional property valuation charge of Rs. 7,500.
4)	Collateral/ Security	Loan amount must be <= 100% of collateral value.
5)	Loan Tenure	Up to Rs.7.5 lakh: Moratorium period + 10 years. Above Rs.7.5 lakh: Moratorium period + 15 years.
6)	Margin Money	Listed Universities: 0Unlisted Universities: Up to Rs.4 lakh – 0, Above Rs.4 lakh – 10%
7)	Moratorium Period	12 months after the completion of the course.
8)	Prepayment Penalty	No
9)	Institutions Covered	Click here

ICICI Bank

ICICI Bank is a major Indian private sector bank that was founded in 1994. ICICI offers a wide range of credit products, as well as banking and financial services, to fulfil the demands of a wide range of customers. The bank is aware of students’ professional aspirations, which is why it has designed its ICICI foreign education loan to ensure that each student succeeds on his or her route to the future. With a collateral-free loan of up to Rs.40 lakh, tax savings on interest paid u/S 80(E), customizable tenure and repayment choices, and competitive ICICI Bank education loan interest rates, students may fulfil their goal of obtaining a world-class education in top universities around the world.

Features Of ICICI Bank Education Loan – 

S.No.	Characteristics	ICICI Education Loan Requirements
1)	Maximum Loan Amount	Rs.1 crore (With Collateral)Rs. 40 Lakhs (Without Collateral)
2)	ICICI Bank Education Loan Interest Rate	Starting @ 11.5% p.a. (linked to their benchmark rate)
3)	Loan Tenure	Loan Without Collateral: For UG – Moratorium period + 5 years. For PG – Moratorium period + 8 years. Loan With Collateral: For UG – Moratorium period + 7 years. For PG – Moratorium period + 10 years
4)	Repayment Holiday	Course + 6 Months
5)	Margin Money	Up to Rs.20 lakh: NILAbove Rs.20 lakh: 15%
6)	Processing Fee	1 % of Loan Amount + GST
7)	Processing Time	7 days
8)	Payments during the Study Period	Repayment during the study period is mandatory, partial repayment options are available depending on the target course and institute.
9)	Courses covered	Job oriented degree or postgraduate diploma/professional courses offered by reputed institutes at the Undergraduate and Postgraduate level

How To Apply?

Going to multiple banks to get quotations for your education loans can be a hassle. UniCreds allows you to compare and apply to the best financial institutions that offer the best education loans for your higher education dreams. Here are some benefits of applying for an education loan through UniCreds –

• Low Time Turnaround

In just a week, UniCreds will get your education loan approved.

• Doorstep Service

Someone will visit your home to pick up documents for your education loans. To get your loan approved, you need not go to any branch.

• No Cost to You

Our services are completely free for applicants. We do not charge the applicants any processing fees or commissions at all.

• Higher Chances of Approval

We approach bank officials immediately to find solutions in the event of any lost records or any roadblocks. This guarantees the quick resolution of problems and dramatically improves your approval chances.

So what are you waiting for? Click here to get one step closer to finding your ideal education loan solution! 

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If you’re a student planning to secure an education loan to study abroad, understanding what an EMI is and how it works would be very helpful for you. An Equated Monthly Installment or an EMI is a very common term associated with loans – whether you’re talking about home loans, personal loans, student loans, or business loans. So what is an EMI and how is it calculated? This article will help you understand everything you need to know about EMIs and how you can plan out your loan repayment process while or upon graduation.

What Are EMIs?

As mentioned earlier, an EMI is an Equated Monthly Installment that is ideally a fixed amount of money that you as a borrower will have to pay your lender to repay your loan easily. Keeping this in mind, there will be a fixed date on which you can pay your fixed amount either via cheques or via online payments on a monthly basis.

EMI Components

EMIs have 2 major components, namely:

• Principal
• Interest

The initial stages of your loan tenure are when you pay your interest amount which at that moment would be higher than your principal repayments. However, towards the end of your repayment period, a bulk of your payments will be contributed towards the principal component.

What Are The Factors That Impact Your EMIs

There are 3 major factors to consider when looking at EMIs which happen to impact/affect your payments and they include:

Loan Amount: The primary factor that determines your EMI value would be the amount you’re borrowing. This is directly proportional in the sense that the higher your loan amount is, the higher your EMI will be.

Interest Rate: Another critical factor affecting the EMIs would be the interest rate on the loans. The interest rate for your loans is calculated by the lenders based on several factors such as your income, repayment capacity, credit history, the prevailing market situation, and many more. 

Can Your EMI Change During Your Tenor?

EMIs do not usually change in a regular tenor period unless there are certain situations or circumstances that may prompt your EMI to change. We’ve mentioned a few of them:

Floating Interest Rate:  These types of interest rates influence your EMIs based on the market dynamics. So when the interest rates fall, do your EMI, and vice versa.

Loan Prepayment: If you prepay a certain portion of your loan amount, your EMI changes. When you prepay a certain amount, your principal amount comes down, consequently reducing your EMI.
Progressive EMIs: You have an option of paying progressive EMIs, particularly if you’ve opted for a long-term loan and if your lender agrees to it. This means that you pay a certain EMI amount initially, which can progressively increase as your salary increases. That way, you can pay off your loan faster.

Let’s outline your eligibility to secure education loans! Fill the form in this blog!

What Is A Moratorium Period?

An education loan usually comes with a moratorium period. This period usually denotes the time in which you as a borrower need not make any repayment. It was designed ideally to facilitate students to start paying upon the commencement of their earnings. 

On a general note, your interest rate is calculated on a compound interest basis, but within the moratorium period, it will be calculated on a simple interest basis only.

How Can You Better Your Chances Of Lowering Your Interest Rate?

Your interest and the EMI payments are directly proportional to the interest rate your lender gives you. While your lender may have the upper hand over this variable, you can secure a great interest rate –

• if you have a guarantor with a handsome credit score
• If you’ve secured admission to a reputed college with promising job prospects to follow

Towards the end of your moratorium period, you will begin your EMI payments. As stated earlier, your interest rate post this period will be calculated based on the compound interest. To compute your monthly dues in your total outstanding amount, you simply add up the principal amount + your total simple interest. The future interest rate and the EMI amount to be paid next will be calculated using the compound interest formula. 

Since this can be a complicated process to understand, it is easier to use an education loan EMI calculator to determine the monthly cost of your loan and the total interest you incur. On that note, you should know about UniCreds which is an online education loan platform that helps fuel the dreams of students who wish to study abroad by providing funding opportunities by way of education loans. If low-interest rates and collateral-free loans are what you’re looking at, this is the right place for you, and now is the perfect opportunity for you to secure a loan with UniCreds.

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To pay off your education loan earlier, you must follow a certain set of practices that will decrease your loan payment period and help you achieve your financial goals faster. Getting a job after graduation is your first step to start the repayment of the loan in the form of Equated Monthly Installments also called EMIs. An education loan can take more than 10 years to get completed, including the interest liability that comes with it. It may look difficult at first but when you plan your loan repayment, the process can be a lot faster and easier. 

Before understanding how you can pay off your education loan earlier, let us first understand why it is important to pay it earlier and how it must benefit you.

Recommended Read: Student loan grace period extension ways

Why Should You Pay Off Your Education Loan Earlier?

When you start your loan repayment, it takes a significant amount out of your monthly salary. This amount can be exercised and used correctly to attain your other important financial goals. Imagine if you end up changing your job, it will hinder and become very hard for you to manage the entire payment. Delay in payments can be a serious problem that will further burden you and jeopardize your credit history. The fewer years you take to repay a loan, the more deduction you see in the rate of interest. This saves you a significant amount of money. 

How To Pay Off Your Education Loan Earlier

Let’s take a look at various methods and ways in which you can plan and implement to pursue an early repayment.

Begin Early

One of the main reasons why many take added years to repay the loan is that they start late. When you take your education loan make sure you consider repayment calculation correctly. Start repaying in the moratorium period. A moratorium period is a time where you enjoy a holiday from your loan EMI’s before you start paying it. Starting then will save you a concession of 0.50% in ROI. Yes, it’s true depending on your lender the relaxation can be given on the payment of education loan if you start early in the moratorium period. 

Create Different Ways Of Income

Before you start with your actual job that will contribute marginally to paying the loan, you can start earning part-time early and save a lot of money before your repayment period starts. The saved money will help you prepay the borrowed amount. One way to plan your repayment and schedule everything as per your convenience is by using an EMI calculator. When you choose to opt for part prepayment, the lender will offer you paying the same EMI. Should you do so? Well, if you want to decrease the loan tenure and save more on the interest then this option is great for you! By keeping the EMI number intact you can repay the loan by cutting more than 6 months in your payment. 

Choose A Shorter Loan Tenure

An easy and smart way to pay off the loans early is to pay more regularly. You can do so by going for a shorter payment tenure. EMI tends to go higher when the tenure is shortened so don’t go to an extent where you will be unable to make that many monthly payments. Choose a shorter tenure that will support paying early by keeping in check with your interest payments. 

Fill the form in this blog TODAY to get free loan consultation services!

Save More | Pay Off Your Education Loan Earlier

From the money that you earn before you start the repayment, save as much as you can. You can open a savings account or a fixed deposit to save money from your salary every month. It is strongly recommended that the borrower save as much as possible to limit their expenses for a period up to the beginning of their loan tenure. This will make it easier for you to repay the loan before the anticipated close. 

Conclusion

Choosing the right lender for your education is very important. Try to borrow from loans that have the lowest interest rate because it is the ROI that digs a hole in your pocket compared to the actual loan amount. 

Followed by using the combination of the above-mentioned tips, it will help you get debt-free sooner without going broke at the end of each month. Moreover, having a good repayment history comes with a reward of a boost in your credit score. That will help you a lot in the future. Good luck! 

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If you are just out of college and living on a limited budget, paying off your student loans can be very stressful. Debt related stress can feel very overwhelming at times, but with some planning, you can stay on top of that stress and make progress towards paying down your debt. Before we get into tips to cope with your student loan stress, let’s talk about the causes of student loan stress:

Student Loans and Mental Health

Financial Pressure Creates An Environment For Mental Health Issues

Two factors that create financial and emotional stress on young adults. First, many young people have a poor understanding of the long-term effects of financial decisions like a student loan. Hence, they tend to take greater risks in their finances than any other age group. Second, over a third of college freshmen suffer from at least one mental health problem. Many of those suffering from mental health problems have experienced its effects right from their school days.

In addition to the responsibilities of job and family, college students facing student loan payments, have an emotional and psychological attack. While budgeting can immediately help put a student back in control, cost-saving measures applied to monthly expenses can help relieve financial pressure and stress. Financial satisfaction is an important component of life satisfaction, and it is closely related to one’s overall psychological well-being.

Anxiety

Anxiety is a natural reaction to stressful situations. Our bodies inflame to provide higher levels of focus to meet a challenge, whether it be a college test or job interview. However, an abnormal level of anxiety, or anxiety that persists long after the immediate challenge has passed, is an unhealthy state and constitutes a mental health issue. Sustained anxiety is a major cause of social phobias and panic disorders. For some people, anxiety becomes the norm, in what is known clinically as a Generalized Anxiety Disorder (GAD). 

Nearly one in three U.S. households currently live with student loan debt. Financial stress is often a contributing factor to anxiety. When an individual has recurring anxiety related to finances (often the case with student loans) it can lead to an emotional and mental environment that leads to depression and other health issues.

Anxiety and stress rank highest among mental health complaints of college students. A study by the American College Health Association (ACHA) of college students found that stress and anxiety were the top non-academic factors determining a student’s academic success. Students in the study reported periods of feeling overwhelmed and exhausted, both of which are linked to anxiety. Students described their symptoms as damaged memory and an inability to process one’s thoughts. On the emotional side, students compared the inability to relax and have a good time and a tendency to procrastinate to more serious emotional problems like depression. Physical symptoms associated with anxiety include rapid heartbeat, nausea, and dizziness. This can be curbed with a few tips to cope with your student loan stress.

Although anxiety is generally associated with personal, social or financial triggers, factors in one’s environment can also play a part. Lack of sleep or disturbed sleep patterns, diet, neurochemical imbalances, and chemical pollutants in the atmosphere can also factor as triggers or accelerators of anxiety. Coping with anxiety is not a very easy task, here are some tips to cope with your student loan stress.

We’ll help plan your finances for education. Contact us by filling the form on this page!

Four Tips to Reduce Student Loan Debt Stress

1. Settle Your Monthly Payments

 One of the best tips to cope with your student loan stress is deciding on how much you will be able to pay every month. If your budget is being eaten up by your student loans, you may want to renegotiate the amount of money you pay each month. This won’t be an option for every loan, but it’s worth asking your loan provider if you can lower your monthly payment amount slightly. Yes, it will take longer to pay the loan off, but it also means that you’ll be able to manage a more realistic budget each month. If your income increases in the future, you can increase your monthly payment amount to the bank.

2. Debt Forgiveness

Depending on what type of loans you have and what type of work you do, you may be eligible for some form of student loan forgiveness. If you have federal student loans, you can qualify for student loan forgiveness by going into certain public service professions, such as teaching. It’s worth checking to see if you fit the criteria for student loan forgiveness, as it can significantly lower the amount of money you pay in the long run. 

3. Don’t Hold Back Too Much

While applying these tips to cope with your student loan stress, don’t cancel out on having fun. When you feel like you’re drowning in debt, it can seem like the only solution is to cut out expenses for ‘fun’ activities. And while it’s important to cut back, you shouldn’t completely cut out the things that make you happy. If you love to go out to eat with friends and you completely stop, you might start feeling more stressed. Instead, look for an affordable substitute to party, like having a dinner party at home or going to an affordable happy hour instead of a trendy new restaurant.

4. Ways To Unwind If You’re Stressed About Student Loans

There are many other ways on how to reduce student loan stress or stress in general. For example:

• Try breathing exercises for relaxation.
• Soak in a warm bath.
• Listen to soothing music.
• Practice mindful meditation.
• Write.
• Use guided imagery.

PS: If there’s anything more you’d like us to know about. Add it to the comments section!

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