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When you feel frustrated, you might find yourself talking in whole paragraphs.
But what if you feel lost — or worse, helpless — when it comes to student loan repayment? In that case, you might only drop us a line or two. One reader wrote, “You guys can’t help me. I tried.”
And that was it.
How to overcome feeling helpless about your student loans
Our reader was responding to an email we had sent him about refinancing student loans. Refinancing — or consolidating your debt and lowering your interest rate — isn’t an option that’s always available for everyone. For one, it requires building good-to-great credit, which doesn’t happen overnight.
If you feel like you’re hitting a major wall when it comes to refinancing, if you’re facing student loan default, or if you’re finding it difficult to quicken your repayment, remember this: Just because you feel that you’re beyond help doesn’t mean you are.
No matter your situation, here are five steps to get back in the driver’s seat and regain control of your debt.
1. Identify the roadblocks
If you feel at a loss when it comes to your loans, it’s probably not the only obstacle you’re facing. There could be a few other blocks.
Take the borrower we mentioned at the beginning of this article who tried unsuccessfully to refinance. He might have been unable to qualify because:
- He has a poor credit history.
- He lacks regular income.
- He can’t find a creditworthy cosigner.
Your feelings of helplessness might be attached to some serious problems. Perhaps you have a mountain of debt in addition to your student loans, such as unpaid credit card balances due to medical bills.
No matter your situation, pinpoint what’s stopping you from moving ahead in your loan repayment process. Although it might seem frivolous, take the time to write these issues down and make a list. You’ll need it for taking the next step.
2. Set numerical goals
You’ve identified the factors that make your student loan situation look hopeless. Now let’s look for some solutions.
Our above reader looking into refinancing options might set the following goals:
- Improve credit score by 100 points.
- Increase income by $500 per month.
- Identify at least three realistic options for alternative cosigners.
Putting a number on your goals will make it easier to track your progress. The numbers also will ensure your goals will push you forward. Say our borrower needs to increase his credit score from 560 to 660 to qualify for top refinancing lenders. Then he’ll know exactly how much ground he needs to cover.
3. Create an action plan
Numerical or not, the goals won’t seem achievable unless you put an action plan in place.
Our reader, for example, could come up with a list of smaller, more achievable to-dos that will help him work toward the more ambitious solution of making refinancing easy.
Let’s say he chooses to increase his income first. He could do the following:
- Craft a resume and cover letter.
- Build his professional network online.
- Find a mentor to help with his job search.
Think about your action plans as a series of steps, and tick off one at a time. Each to-do should naturally lead to the next, giving you momentum. It wouldn’t make sense for our reader to start applying for jobs, for example, before working on his cover letter.
See if we address roadblocks and goals specific to your situation in our step-by-step guides. If not, contact us to learn more.
4. Hold yourself accountable
Unless you have a significant other, friend, or mentor who can help push you toward achieving your goals, this responsibility will fall entirely on your shoulders.
An easy way to hold yourself accountable is to set deadlines. Our reader might attach weekly deadlines to his action plan for finding a cosigner, for example.
His schedule could look something like this:
- Week 1: Identify cosigner candidates in the network of family and friends.
- Week 2: Set up a time to speak with each candidate.
- Week 3: Prepare a pitch to recruit a cosigner.
- Week 4: Meet with each potential cosigner in person.
Your situation might be a lot more complicated than our reader’s, so cut yourself some slack by spacing out due dates.
As long as you attach a time element to each step, it’ll be easier to reorient yourself if you lose your place.
5. Celebrate your progress
You’ve set ambitious goals and have been working to achieve them. Don’t forget to monitor your progress toward each one.
This can be an easy exercise if you set up a system for tracking goals. Whether it’s via a sticky note on your fridge or an Excel spreadsheet on your laptop, use anything from checkmarks to data to see how far you’ve come.
Our reader, for example, might use a budgeting tool such as Mint to track monthly changes in his estimated credit score. It’ll keep him grounded since borrowers with bad credit could have to wait for months or even years to see their score jump significantly, according to consumer credit reporting agency Experian.
If you’re in it for a similarly long haul, break up the monotony with celebrations along the way. Noting a 50-point rise in credit score or a $250 increase in monthly income, for example, will help you overcome debt fatigue. It also will help you keep an eye on the finish line.
Seek to empower yourself during student loan repayment
Think about your student loan repayment by picturing movement along a spectrum. What matters most is that you’re moving in the right direction, and as quickly and efficiently as possible. Don’t stay still.
Along the way, check out our blog for additional resources and support. You also might want to seek professional advice from a certified financial planner if you want to take a holistic approach to your overall financial situation.
Just remember: No one can help you as much as you can help yourself.
If you have a student loan question you’ve been waiting for an answer to, contact our customer support team. Your question might end up in this column.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.30% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at email@example.com, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate|
|2.47% – 6.30%1||Undergrad & Graduate|
|2.51% – 8.09%4||Undergrad & Graduate|
|3.02% – 6.44%2||Undergrad & Graduate|
|2.48% – 6.25%5||Undergrad & Graduate|
|2.79% – 8.39%6||Undergrad & Graduate|