Friday, November 20, 2009

Smart Ways to Refinance Student Loan Debt in the Financial Crisis

You finally made it through four long years away college. Now that you have graduated and taken a job, you might have even begun to pay on your student loan debt. Student loan debt can accumulate fast while you are busy trying to get an education. Many students, upon leaving college, find that they have what appears to be an insurmountable array of student loans to begin pay on, and oftentimes making the payments on your student loans can become a huge burden.
Most students who have recently graduated are having a tough time finding a good job. The global financial crisis has left many companies with no option other than to shut their doors, reduce the number of employees they have on staff, or outsource their work to foreign countries who provide cheap labor. This leaves a lot of recent graduates out of luck when they begin their search for employment - and oftentimes the graduate is stuck in a job that pays so little they cannot afford their student loan payments. If this situation is true for you, then you are not alone. Many, many students are having it rough once they get out into the real world.
1.Consolidation = Lower Monthly PaymentsYour best course financially if you are experiencing difficulty in managing your student loan payments is to consolidate your loans to refinance the amount that you owe. When refinancing or consolidating, you will obtain a new loan that encompasses the multitude of lenders that you currently owe and pays each one off in full. In turn, you will make one monthly payment that reflects the bulk of your loans that are outstanding. Refinancing is a great choice for those who are having trouble paying their loan payments, and can save you a lot of hassle in the future. By consolidating, you can get a lower monthly payment that lets you keep more money in your pocket.
2.Avoid Garnishment Of Your Wages
Student loan debt is one debt that will never go away on its own. You cannot file bankruptcy and include your student loan debt in the proceedings. If you fail to pay your student loan debt, any future refund that might be due to you from the Internal Revenue Service will be offset to pay the lender. In addition, your lender can seek and receive a judgment against you, forcing your employer to garnish your paycheck.
In some states, the employer must garnish all wages above $154.50 per week after taxes- just imagine living on that type of wage! As barbaric as it might sound, these garnishments are one hundred percent legal and for borrowers - there is basically nothing that can be done when an account reaches garnishment except to continue working until the debt is paid.
3.Apply Online From Comfort Of Your Home
You might want to search online for lenders who offer student loan refinancing and consolidation. Online lenders have typically lower interest rates than walk-in banks, and offer the added convenience of applying over the Internet form the comfort of your own home.
Hilary Bowman is the author of this article. She works successfully as a financial advisor with years of expertise on Unsecured Loans. Hilary publishes informative articles about home loans, credit cards, auto loans, loans with bad credit, business loans and others at

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