The process of selecting a federal student loan repayment plan can be daunting. To help borrowers better understand and compare their repayment options, the U.S. Department of Education recently upgraded its options Loan simulator Tool.
You can use this free online resource as a personalized guide for researching strategies for getting your data back Student Loans. Note, however, that it is for informational purposes and does not guarantee future loan payments with 100% accuracy.
To use the tool, you can either sign in with your Federal Student Aid ID (FSA ID), which will automatically fill in your information, or you can enter your details manually. Because it uses your specific information – including your salary as well as the balance and interest rate on each of your student loans – the loan simulator offers customized tips based on your particular financial situation and goals.
In the loan simulator you can explore three different modules:
- Compare the options of the repayment plan to meet specific goals.
- Inquire about ways to decrease or stop monthly payments.
- Simulate the effects of taking additional student loans.
Compare the options of the repayment plan to meet specific goals
This module allows you to analyze your repayment options based on your short and long term financial goals. You can also enter your information manually or use sample loan amounts based on national or college averages.
After a few basic preliminary questions, you can choose from a menu of repayment goals to customize your options. These goals include: repaying my loans as soon as possible; have a low monthly payment; Pay the lowest total amount over time; choose my monthly payment; pay off my loans by a certain date; or no specific goal.
Next, the tool will show you which repayment plan will best fit the goal you have chosen. For the selected plan, you can view your estimated monthly payments, the estimated total amount you will pay over the life of the loan, your expected repayment date and, in case you want to make an application Granting of loans to the public service, Your estimated amount of forgiveness.
You can click through additional options and compare estimates of your monthly payments for each plan, as well as the total expected payments over the life of the loan. You can also switch back and forth between different destinations for easy comparison.
The loan simulator also shows you how each plan would affect you if you are registered with PSLF, and indicates whether a particular repayment plan is a good option for those looking to take advantage of this forgiveness program. You can also investigate whether consolidate Your student loan could be a good move.
Explore options to decrease or pause monthly payments
Another module in the loan simulator will help you navigate your options to decrease or pause your monthly payments if you are having difficulty making them. Depending on your situation, the tool outlines the pros and cons of various options, including registering for an income-based repayment or applying for one Procrastination or forbearance.
For each option, the tool indicates whether this option pauses or only lowers payments, whether it offers interest subsidy benefits or counts towards lending programs, and whether it is a long-term solution – for example, inclusion in an income-related repayment plan. or a shorter term solution, e.g. B. the temporary interruption of monthly payments through a deferral or forbearance.
As with the repayment plan estimator, you can switch between different options to easily compare different scenarios.
Simulate the effects of taking additional student loans
The third and newest module in the Loan Simulator, launched in November 2020, simulates how borrowing additional federal student loans will affect your overall loan balance and repayment options.
In this module you can enter details about the Type of program You’d borrow more money – whether for a current or a future study program – and the amount you think about. The module then shows what this additional borrowing would mean for your repayment, including the size of your total loan balance and the impact on your monthly payments under different repayment scenarios.
This module also provides helpful tips on how to pay less during the life of your loan, how interest capitalization will affect your balance, and how to find details about your school Net price.
While student loan repayments can be confusing, the loan simulator can help you decide which repayment options are best for you, how to find relief if you’re having trouble making payments, and how your repayment schedule might affect you, if You opt for one more repayment loans.