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Managing Loans

 

 

Responsible Borrowing

 

The following tips will help you make informed, responsible choices about student loans and lenders:

Evaluate your financial aid award carefully. Explore other sources of aid, such as grants, scholarships, and work-study programs that do not require repayment. At The University of Texas at El Paso it is our goal to provide grant funds to eligible students to keep students’ debts to manageable levels.

If it is determined that borrowing beyond the amount in your award is necessary, borrow only what you need and not what you desire. Remember, you have four years of undergraduate schooling. Pace yourself. You are expected to repay your loan plus interest. Repaying your loan on time will help you establish a good credit rating. It is also very important that you avoid all forms of credit card debt. Acquiring credit card debt is not necessary to establish a good credit rating, and it may be detrimental to your financial health.

Explore your anticipated career and the typical first-year salary for that profession with the Career Center. While not a steadfast rule, consensus is that the monthly repayment of all undergraduate loans should not exceed eight percent of future gross monthly income. At a debt level of $20,000, your yearly future gross income should be around $32,000 to be within these guidelines.

Consider a lender that provides methods for you to manage your money through graduated repayment, loan consolidation, flexible forbearance policies, one-time capitalization at repayment policies (for unsubsidized Federal Stafford and PLUS Loans), and continuity of servicing