SPOKANE, Wash. - It's graduation season and students are graduating college with more debt than ever.
A new report shows student loans make up $34 billion of American household debt. 11% of borrowers are also defaulting, meaning they are 90 days or more past due on their accounts.
Students are required to take exit counseling for federal loans upon graduation, but many likely don't pay close attention. Then getting that first check in the mail can come as a shock.
"I got some random... I don't know what it was... it was like over $1,000 due for that month and I was like, 'hold up,'" said Greg de Souza, who graduated from EWU in 2011.
Many students are finding themselves with bills they can't afford to pay back. Experts at Gonzaga University say don't sit on that. There are steps you can take, and the first is calling your loan provider.
"If they're afraid to contact their loan servicer, they should contact their school to let them know of the situation and the school is going to have some options available for that student and tell them how to go about that process," said Associate Director of Financial Aid at Gonzaga Louisa Diana.
You can also ask your provider what kind of payment plans you qualify for. There could be programs you don't even know exist.
"Such as income driven payments, where your payment is actually based on your income and sometimes that's zero dollars," Diana said.
With our economy, it's also not realistic that every graduate will find a job right out of school. If you're struggling, don't panic because it can be worked out.
"If a student's unable to find a job after they're done with school, their loan servicer is going to have what's called an unemployment deferment that's available to them and they just contact the servicer, fill out some paperwork, and that's usually going to be granted," Diana said.
And if you're looking to repay your loans quickly, graduates say keep your spending in check.
"Live within your means. It's really important to live within your means," said de Souza. "Delay the purchase of a home. You don't need to go out and buy a 2017 vehicle. Live frugal."
Finally, beware of student loan scams. If you get an offer that sounds too good to be true, it likely is. You can contact your provider or school to get information about anyone offering to help you pay back your loans faster.
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