College grads have trouble paying back student loans - KWWL - Eastern Iowa Breaking News, Weather, Closings

College grads have trouble paying back student loans

Posted: Updated:
WATERLOO (KWWL) -

Many college graduates find themselves wishing time would slow down as student loan payment dates inch closer.

According to the Milwaukee Journal-Sentinel, The U.S. Department of Education recently announced an increase in federal student loan cohort default rates. The latest report of the national two-year rate shows 10 percent of college graduates defaulting with their loans. Iowa's two-year rate is 12.3 percent.

A loan payment becomes defaulted after 270 days of failure to make a payment. Private loans have the ability to reach default even sooner.

The Iowa College Student Aid Commission said in a Sentinel article one of the biggest mistakes college graduates make is not keeping in touch with their loan providers. The commission said grads must keep their contact information up-to-date in order to receive information about upcoming deadlines.

It also recommends seeking different payment plans, such as pay-as-you-go and income-based repayment plans. It advises graduates to contact their loan provider before payments are due; that way, if they does encounter financial trouble, there is time to discuss options best suited for their budgets.

Powered by Frankly