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  • Repayment

    Student loansAbout 60% of all college students will need to take out a loan for college related expenses.
    Student loans are designed to help young adults enter the workforce with manageable debt.
    However students should understand that student loans will be with you until they are paid off completely.  Even filing bankruptcy will not erase your student debts.  Your loans will be paid back, and they will be paid back with interest.

    Loans and borrowing
    Repayment plans

    If you take out the UW La Crosse average of $25,000 and have a standard repayment schedule of 10-years, you are looking at a $276 payment every month for 120 months!

    A good thing to remember is you can always pay more than what your payment plan states. By doing this you'll pay less interest and get rid of the debt faster.

    Debt.org also explains the government Student Loan Forgiveness Program on their website.

    Repayment plan

    Monthly payment and time frame

    Comparison

    Standard repayment plan Payments are a fixed amount of at least $50 per month.

    up to 10 years

    You'll pay less interest over the life of your loan under this plan, but will likely pay the mot per month.
    Graduated repayment plan Payments are lower at first and gradually increase, typically every two years.

    Up to 10 years

    You'll pay more for your loan in total compared to the standard 10-year, but you'll have an easier time making payments when the loan is first taken out.
    Extended repayment plan Payments may be fixed or graduated

    12-25 years

    You'll have smaller monthly payments but in the end you will pay much more in interest.

    You are only eligible for these repayment plan if you have $30,000 or more of outstanding loans.
    Loan default

    Make your loan payments or you risk going into default.

    What qualifies as student loan default

    Late payments in and of themselves are bad but student loan default is when you miss payments on your account for a certain period of time:

    -If you are supposed to make monthly payments and you fail to make payments for 270 days your account will be considered default.

    -if you are supposed to make payments more frequently than monthly and you haven't paid for 330 days your account will be considered default.

    The consequences of student loan default

    -Ineligibility for deferment, forbearance, and other repayment plans.

    -Ineligibility for additional federal student aid.

    -Your account is assigned to a collection agency.

    Default

    The penalties can include but are not limited to:

    -Late fees.

    -Additional Fees and interest.

    -Wage garnishment

    -Tax offset (you won't get your tax refund).

    -The entire unpaid balance of your loans and any interest is immediately due and payable (your no longer on the hook for just the payment, your now on the hook for everything!)

    -Ruined credit score (makes buying houses or cars extremely difficult.)

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    Fun Facts 

    If the money you spend in four years at a public college was a stack of pennies, it could reach more than 8.5 miles high, higher than most airplanes fly.


     84% of college students have a credit card.  50% of them have 4 or more.


    The average total debt for the Class of 2013 is $35,200.


    There the will be approximately $1,200,000,000,000 in circulation in 2013.


    $67,000,000,000 in student loans were in default in 2011.


     

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