Do AES loans qualify for loan forgiveness?
Ans: Yes, But generally, AES loan forgiveness is offered to those employed in certain public service occupations, medical practice, military service, or other volunteer work.
If you’re like most college graduates who left school with a substantial amount of debt, loan forgiveness can sound like a dream come true. The eligibility requirements may vary depending on the type of loan you have.
There are no real shortcuts to pay your student debts, but in this article, we can help you explore the options to help you get rid of that debt once and for all. So if you’re interested in learning more about AES student loan forgiveness and other favorable payment options, make sure to read the article until the very end.
Types of Forgiveness & Other Payment Options
The first step to have your loans forgiven is to know whether you qualify based on your occupation or other circumstances. To offer a quick view of the types of forgiveness, the two most common types of federal student loans include public service loan forgiveness and teacher loan forgiveness. So if you work in the public sector or at a low-income school, you may be eligible to have your loans forgiven
Nonetheless, you can also be eligible for loan discharge when there are extenuating circumstances that affect your ability to repay your loans. The Social Security Administration (SSA) and the U.S. Department of Veterans Affairs (VA) have internal processes for receiving a disability determination due to a physical or mental impairment that may be expected to result in death or has lasted for at least 60 months.
If forgiveness or discharge isn’t an option, you may want to consider applying for a loan settlement or declaring bankruptcy to reduce your debt in severe cases. Filing for a student loan bankruptcy may be a lengthy process but it could help you rebuild your financial life, instead of continuing to struggle to pay your debts.
Pros & Cons
The most prevalent advantage of AES loan forgiveness programs is that it helps you get rid of your student loan debt, which could also mean current monthly payments could go toward savings or another spending. Federal loans also offer a variety of repayment options, which will be discussed in the next part of this article.
While the idea of wiping out your debt may feel beyond amazing, there are some drawbacks that you need to consider before pinning your hopes up. Some of the potential drawbacks include giving up your federal benefits and protection from the U.S. Department of Education. Furthermore, while you’re busy making your required payments, the interest rates may also accrue on your loan over the extra repayment schedule.
Other Repayment Options
There are a total of eight (8) federal student loan repayment plans that you can choose from to give you a more manageable student loan payment and help you create a solid plan to keep you debt-free.
The repayment plans include the Standard Repayment Plan, Graduated Repayment Plan, Extended Repayment Plan, Revised Pay As You Earn Repayment Plan (REPAYE), Income-Based Repayment Plan (IBR), Income-Contingent Repayment Plan (ICR), and Income-Sensitive Repayment Plan.
If you want to pay less interest during the overall repayment duration, it can be a good idea to opt for standard repayment as demands lower interest rates. On the other hand, if you want to lower your student loan payments, consider the income-driven repayment option to set a cap on each payment between 10% and 20% of your discretionary income and forgives your remaining balance after 20 or 25 years of payments.
Student Loan Repayment Tips
When it comes to handling your student debts, it is important to improve your personal finances and practice an effective budgeting method that works for you. These tips will help you pay the remaining student debt that you still have and keep you out of the debt cycle.
Create a Budget Plan
The first step to improve your finances is to create a realistic budget to identify your income and expenses. A great rule of thumb to follow is the 50/30/20 rule, wherein 50% of your income should be allocated for needs (food, housing, utilities, etc.), 30% for wants and 20% for student loans or savings. It is also advisable to write everything down to see the biggest picture, instead of managing your expenses in your head.
Cut Unnecessary Expenses
By eliminating non-bills and non-essentials off of your daily expenses, you can create some extra room in your budget. The most practical way to decrease your spending is to cut back a little in each area and work your way there, instead of taking out big chunks all at once. This way, you can save all these small expenses and save them until they add up to hundreds or even thousands of dollars that you can use to pay off your remaining student debts.
Look for Other Income Sources
Building multiple streams of income is a necessity for people who wants to get away with debts. By solely relying on your 9-5 job for your entire livelihood and debts, you will have a harder time to budget your needs and expenses as compared to having several streams of income sources. These extra income sources can go a long way in helping you pay for your debts and other unprecedented financial emergencies like job loss, hospital bills, car repair, etc.
Monetize Your Skills
One great way to find a side hustle to increase your overall cash flow is to find a skill that you can monetize. Although it may seem daunting at first, there are countless opportunities out there, such as creating an online course, becoming a freelancer, starting a blog, affiliate marketing, and more. It is crucial to keep in mind that the things that we do outside of our 9-5 job will determine our financial standing in the future.
Refinance Your Student Loans
You can save hundreds in interest if you consider refinancing your existing student debt to a lower interest rate. This works by finding a qualified partner to shoulder your existing student loans and replaces them with one loan with a new interest rate and payment schedule.
In Conclusion
Depending on your career, there are loan forgiveness and repayment options that can help you shrink down your huge student loan balance. If you need help with the payment of your student loans, whether you’ll be graduating from college soon or you’ve been trying to kick those loans for a decade, consider seeking a consultation with a financial expert.
We invite you to explore our website to learn more about our services and get on a fast track to dumping your student loan debt for good. As always, our professional team will be here to provide you with all the information you need to keep your finances in order.
