College Loan Consolidation, Federal Loan Consolidation, Private Loan Consolidation, Student Loan Consolidation

America's Top Student Loan Provider

Are Student Loans Good Debt?
A troubling trend is doing away with the conventional wisdom that student loans are good debt. It's a common belief that, like a home loan, student loan debt will turn into an asset. But it doesn't always turn out that way. Increasingly, people are finding themselves unable to pay off or falling behind on their loans.

The U.S. Department of Education recently reported that the national default rate on federal student loans rose slightly, to 5.1 percent in 2004 (the most recent year for which data is available), from the previous year's record low of 4.5 percent.

Although the current default rate is low compared with the all-time high of 22.4 percent set 14 years ago, the latest increase is still a signal that shouldn't be ignored.

Since the 1990s, the number of students graduating with more than $25,000 in loan debt has tripled, according to the student Public Interest Research Groups, which, along with several state student associations, last year launched the Student Debt Alert project.

There are some forms of relief available for borrowers sinking in debt, although bankruptcy is not an option. If you have a federal student loan, it can't be discharged in bankruptcy. If you have a private student loan, declaring bankruptcy is still not a viable option unless you can prove that paying the loan would result in "undue hardship," a test for which the criteria are nearly impossible to meet.

However, depending on the loan, there are several other options, such as graduated repayment plans, under which payments start out low and increase over time, typically at two-year intervals.

Some loans have income-contingent options. An income-contingent option gives you the flexibility to pay off your loan based on what you earn.

If you are experiencing economic hardship, you may be eligible for deferment. Under this option, you still have to pay off the loan, but you can postpone payments for awhile. Interest on the loan, or loans, will not accrue during the deferment period.

Another option is forbearance, which allows you to stop making payments for a set period of time. Unlike the deferment option, forbearance does not stop interest from accruing. But forbearance is easier to get.

In the meantime, if you have the cash, should you pay off your loan? Financial experts may have mixed opinions about this, but as the old Chinese proverb goes, "A good debt is not as good as no debt."


Article Title : Are Student Loans Good Debt?
Comment not found for this article.

Share this story:
  • BlinkList
  • blogmarks
  • Digg
  • Facebook
  • Google
  • Sphinn
  • MySpace
  • NewsVine
  • Simpy
  • StumbleUpon
  • Technorati
  • E-mail this story to a friend!
  • Print this article!
  • Faves
  • Furl
  • Netvouz
  • Slashdot
  • Spurl
  • Yahoo! Buzz

EdFed introduces… Awareness… Learnal
At, EdFed, we proudly introduce 'articles on student loans' and 'Learnal - the journal to learn from', our free newsletter on student loan management, which is sure to keep you informed of the latest events and happenings in the student loan market. To receive your copy of the above just use the RSS feed below and add this to your "My Yahoo", blogs, newstickers, and other similar channels accepting distributable content.
Click here to sign up for our Weekly Newswire now!

How EdFed Helped others!
The first time I called in I spoke with a loan consultant immediately. The service and help I received was incomparable. The representative that I spoke with was knowledgeable and able to answer all of my questions. She even took me through each step of the application. She was extremely friendly and I thank her deeply for helping me through the consolidation process.
- Jenna D.  Santa Fe, NM
* Your Name: * Your E-mail Address:

We respect your privacy.
* Your Friend's name: * Your Friend's E-mail address:
Include a Message:
+ Privacy Policy

Student Loan Consolidation Info - How to Choose the Right Loan Company

This column is sponsored by Granted, America's top job search engine. The Career Resources column is presented by Granted, America's leading job search engine dedicated to getting people jobs.

Education is one of the most basic right of any human, but with the increase in prices and the costs involved in education this has made these rights turn into a privilege which very few can enjoy. Any normal person today in the whole of United States has to take an education loan at one point of time to pay for their education fees.

read more
Schools Will No Longer Receive Paper FAFSA Forms
(September 20, 2007)

news desk
Stafford Loan Payment Calculator
PLUS Loan Payment Calculator
Loan Consolidation Payment Calculator
Glossary of Terms
Loan Comparison Chart
Scholarship Search
Within 180 days of the funding date of your EdFed consolidation loan, you may add additional eligible loans to your consolidation loan.
US School Directory
Comprehensive List of Schools at which EdFed Assists Students.
EdFed is a FFELP lender with lender identification number 834241.
© Copyright 2017 EdFed. All Rights Reserved.

Home · About Us · Contact Us · News · Sitemap
Career Advice · Tell a Friend · Privacy Policy · Resume Service
Resume Distribution Service · Post Resume · Job Search Course
Sign up for the latest news on student loans.
Email Address:
+ Most Recent Newsletter
+ Newsletter Archives