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According to The Institute for College Access & Success, seven in 10 seniors (68%) who graduated from public and nonprofit colleges in 2015 had student loan debt, with an average of $30,100 per borrower. This represents a 4% increase from the average debt of 2014 graduates. Graduate students, for example, have a median debt of $57,600, and 1 in 4 have debts of $99,614 or higher, according to New America, a public policy think tank.
How do you pay off your loan faster?
Tip #1: Use Auto-Debit
If you sign up for auto-debit, which most federal and private student-loan lenders offer, you’ll get a 0.25 percentage point reduction in your interest rate and have your bill amount drawn directly from your bank account every month.
Federal student loans
The federal government uses 10 different federal student loan service providers, all of which offer the automatic payment option. These providers are as below.
2. Great Lakes Educational Loan Services, Inc.
4. FedLoan Servicing (PHEAA)
8. Granite State - GSMR
9. OSLA Servicing
10. Debt Management and Collections System
Private student loans
Sallie Mae is the largest private student loan servicer. Like federal student loan service providers, Sallie Mae offers the automatic payment option, as well as the .25% interest rate reduction. If you have a different private loan provider, check with them about the auto-pay interest rate reduction plan.
Tip #2: Refinance Your Loan
You can always refinance your loan. Refinance lenders generally look for candidates with a steady income, good credit and a few years of work experience, or a co-signer with those qualifications. NerdWallet recommends 11 companies to refinance your loan. Some of these companies are:
1. Citizens Bank
2. College AVE Student Loans