Once you graduate, you are faced with a hard truth: You are going to have to start paying back your student loan debt.  This is a sobering thing to think about.  You have a lot of options, but the best two are student loan debt consolidation and student loan debt refinance.

Both are good options, and deciding on which to go with really only comes down to how many loans you have and what type of loans they are.  The right plan of attack is going to be based on your interest rates and how many loans you have and how many are federal student loans versus private student loans.

If you have a large number of loans, probably from getting separate financing each semester, there is a high likelihood that you have private loans.  If you do have private loans, there is a good chance that the interest rates on them are both high and adjustable.

These loans are best for a student loan consolidation.

In these scenarios, you will actually accomplish quite a few positive goals.  First of all, your payments will be lowered just by eliminating multiple payments.  However, you will also be able to change all of the adjustable rates into fixed rates.  When the economy rebounds and interest rates rise again, you will be unaffected by the shift and locked in at today is financing rate.  You will also get the added benefit of getting to miss two months worth of payments on all of the loans.

If you only have one large loan, the best option will be to refinance your student loan debt.  It is more than likely that you will run through your deferment time well before you are making enough money to comfortably make your payments.  When your deferments run out, it is time to look at the state of your current loan.  There are only two reasons to go through with the refinance.  If you have an adjustable rate, it is almost imperative that you refinance, and if you are able to lower your interest rate by at least a percentage point, then it will make sense.

If you are not able to accomplish either of these goals, then you are going to be better off with the loans that you already had.  You can try to get forbearance, but you are probably already as good as it will get in terms of your actual loan scenario.

There are options for managing your student loan debt.  Either through student loan debt consolidation or through refinance you should be able to get your interest rates to a very low rate, and most importantly, get them on fixed rates.

More people are enrolling in schools, the price for admission is increasing, and a larger percentage of students are relying on student loans to finance their education.

While enrollment has already increased dramatically in the last five years, it is expected that by 2018, enrollment in four-year programs will increase another twelve percent, and enrollment in two-year programs will increase by another thirteen percent.  As of now, there are already almost nine million students enrolled in four-year programs.  This means that there will be over ten million within ten more years.

The average price for one semester of tuition is constantly increasing as well.  Right now, the average cost for one year of tuition at a private university is $26,273, which is 4.4 percent higher than last year.  The average cost of tuition at a public school is $7020, which is an increase of 6.5 percent from last year.  Even the rates for two-year universities have increased 7.3 percent from last year to $2,544 a year.

A much larger percentage of enrolled students are relying on student loan debt to manage these costs as well.  Last year, a staggering 60% of college students were using student loans.  In addition, more shocking is the increase in overall debt balances that the average student is carrying.  The average debt for all borrowers is up 18 percent to $22,700 from $19,300.

Federal loans and Federal student loan consolidation are not as readily available as they once were either.  The problem is that the pool of people needed loans has increased at a much faster pace than the pool of funds available for loans.  Compounding the effect of all of this is that federal lending has tightened up, due to the financial crisis.  Federal Loan programs have not only tightened their lending guidelines, but also have an even smaller pool of funds to lend.

As a result, many borrowers are resorting to credit card debt as a supplement.  In 2008, an unbelievable eighty four percent of undergraduate students had at least one credit card.  This was an increase of seventy six percent from 2004!  The average number of credit cards held has risen to 4.6 per student, and even more shocking, over half of all students have more than four individual credit cards.

Student loan debt has risen to record levels in the last few years.  However, do not expect to see those levels decrease.  In fact, all numbers point to the fact that the overall level of student debt will not only continue to rise, but so will overall student debt.

Struggling with student loan debt can be one of the most stressful situations to be in for someone after college. Especially in today’s economy, it is difficult to find a job that will lead to an actual successful career right out of college. Because of this, it is taking longer and longer for people to find themselves in a comfortable enough place, financially to be able to easily maintain the payments.
The direct effect of this is that defaults on student loans are higher than they have been since 2000. Defaulting on a student loan wreaks havoc on more than just someone’s credit, but also on their personal lives. Defaulted loans are forwarded to collection, and the phone calls begin. Further down the line, these collections are taken to court and become judgments. With the judgments comes the wage garnishment, which can make every part of living hard, especially for someone new to the workforce who has not yet found a stable career.
The issue at the center of this is the question of payment deferment. Each borrower is only allowed limited time to defer the payments. After that, the only option is to obtain forbearance, which is not available to everyone. These, coupled with the fact that a borrower cannot include Federal student loan in a bankruptcy, leave borrowers with very few options.
At the height of the lending boom a few years ago, the options for student loan consolidation were quite numerous. Private lenders were able to take over the debt and still receive the protections that come along with holding a federal debt. New student loan lenders popped up every day. However, with the cash of the mortgage market came the crash of most financial markets, including the private school loan consolidation market. Even the Federal Perkins Loan consolidation was scaled back in the wake of the financial crisis.

This has left borrowers in a crisis. The options that were once there have, for the most part, gone the way of the dodo. Nevertheless, there are still options.

A loan consolidation can typically not occur if the student loan is already in default and with a collection agency. But, it is extremely difficult to get a student loan out of default status, especially if it has already made to collections or to a judgment. There is someone there to help, though.
Each state has an appointed position called a student aide ombudsman. The job of this position is to fight for the rights of borrowers. They will help to get a borrower’s loan out of default status so that the borrower can go through with a student loan debt consolidation and start making regular payments.

For someone struggling with student loan debt, things are difficult. In addition, while there are not as many options as there once were, there is still a way out of the hole.