There’s other options available if you don’t qualify.
After President Biden announced his plan to cancel $10,000 in federal student loan debt for many of the 43 million students currently holding a student loan, who sum up to over $1.7 trillion dollars in debt.
Even though student loans can be borrowed from different sources, the president’s announcement doesn’t include private student loan borrowers, but those who took money from a private lender could still have some options to save money on their payments.
Since private student loans are owed to a private lending institution and not the federal government, these student loans aren’t eligible for cancellation or forgiveness under President Biden’s plan, so borrowers will have to continue paying them as usual.
This is due to the government only paying individuals and not institutions, but if a borrower is having trouble paying their private student loan, they could refinance their debt and take advantage of the possibilities this option brings to the table.
Student loan debt refinance has some advantages but also some downsides, for instance by consolidating your student loan debt, you most likely will lower the interest rates, giving you a room to save during the life of your loan.
But the interest rate can only be chosen as variable in a fixed rate, meaning it could change without any previous warning, and this refinancing could also lead to a longer time paying your loan.
While on the other hand if you consolidate your private and federal student loans, you may lose eligibility to have your federal student loans forgiven under Joe Biden’s new plan.
© Unidad Editorial Información Deportiva, S.L.U. All rights reserved.
Student Loans: What loans are not eligible for forgiveness? – Marca