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Things to Consider when Choosing a Repayment Plan

Your Financial Goals.  Where do you see yourself five or ten years down the road, married, with children, owning a home, car, planning for retirement.

Your Total Debt.  Do you have credit card debt which may be accruing interest at a much higher interest rate than your student loans?  Consider lowering your monthly loan repayments to pay off your higher interest rate credit card debt first. 

Your Net Income.  What will you actually take home each paycheck after taxes, FICA and Medicare have been deducted?

What can you afford to pay each month on your education loans?  Prepare a budget.  Compare your income with your expenses.

Your Attitude Toward Debt.  Do you wish to pay off your education loans as quickly as possible or do you wish to pay it off at a slower rate utilizing the savings you incur each month to save for retirement?

Are there repayment incentives on any of the Federal loan repayment plans?  If you opt for automatic debit of your monthly payments, you will receive a .25% in interest rate reduction which could add up to a considerable amount over the life of the loans, depending upon the amount borrowed.

Are there penalties for prepaying my Federal loans?  There are no penalties for prepaying any of your Federal loans.  Making lump sum payments over and above your monthly payments will save a considerable amount of interest over the life of the loans.  Always pay off the highest interest rate loans first and work your way down to the lowest to get the greatest benefit.

Does your employment qualify you for Federal Loan Forgiveness?  If so, be sure you choose a repayment plan that qualifies for that forgiveness.

Are you eligible for Fordham's Loan Repayment Assistance Programs?  If you are employed in a 501(c)(3) corporation or have a two-year clerkship or two one-year clerkships, you may be eligible to receive loan repayment assistance from Fordham.  If you are unsure whether you are eligible, check with the Financial Aid Office.