When the student loans loom: Tips for tackling the beast

​​Ah, graduation! The beginning of a new job, a new life and a world of opportunity.

And, in six short months, the beginning of those student loan payments.

It can be daunting, says Julie Wilson, associate director of client services in the Office of Scholarships and Financial Aid.

She offers some tips:

Stop in — the financial aid staff is there to help. Students can make a 30-minute appointment to meet in the financial aid office in Warriner Hall 202 or walk in for assistance at the Student Service Court, Room 119, in the Bovee University Center.

Parents are welcome to join their son or daughter at the appointments or stop in at Warriner when they’re on campus.​

Start planning early.

“Students shouldn’t wait until their last semester to think about how they’ll pay their student loans,” Wilson says. “But that’s what most students do.”

The first bill for student loans is typically due six months after graduation, Wilson says. Mark it on the calendar.

Save all your documents — and for longer than you think.

“Keep all your documents from your loan servicer and from CMU,” Wilson says. “If you made a loan payment of $50, save that confirmation in a folder. Five or 10 years later it may come up on a credit report that the payment wasn’t made. You’ll want to have that documentation.”

Check on your loan occasionally to see if all your payments are properly credited.

Visit the National Student Loan Data System at www.nslds.ed.gov.

“All students can see how much they borrowed, how much they’ve paid, any grant money they received,” Wilson says.

Visit Wilson’s favorite website: youcandealwithit.org.

“I love this website,” she says. “I tell everybody about it.”

The site offers helpful tips in all areas of paying for college and managing student debt, from making payments to managing money to calculators and other interactive resources. Visit http://www.youcandealwithit.com/borrowers/index.shtml.

Students, not parents, should do the entrance counseling.

When students take out a federal student loan, they’re required to do “entrance counseling” online at studentloans.gov.

Students learn how the loan process works, how to manage education expenses and discover their rights and responsibilities as a borrower.

“We hear from a lot of parents who are doing it themselves,” Wilson says.

Resist the urge. Parents who do the counseling for their sons or daughters aren’t doing them any favors, she says. By using the interactive site, students learn the impact of their borrowing, Wilson says.

Have a budget.

“A lot of students don’t even know what a budget is,” Wilson says. “They never see the cash — it goes straight into their CMU account.”

When she meets with students, Wilson shows them a loan calculator to figure how much their loan payment likely will be. Then she shows them how to figure that in with other projected expenses, including rent, insurance, utilities, etc.

“They learn if they’re going to borrow $28,000, how much of a salary they’ll need to make,” she says.

Then, stick to that budget.

“I tell students, ‘Live like a college student,’ but not all of them know what that means,” Wilson says. “I see students get Starbucks every day. Those add up. I see gals getting their hair and nails done at a salon. Are those really needs, or are they just wants? Do you really need that latest iPhone?”

Beware of scams.

“There are companies out there who say they’ll help you consolidate your loans for a fee,” Wilson says. “Anytime anybody asks for money, be leery.”

Students can consolidate federal education loans into a federal Direct Consolidation Loan without a fee, Wilson notes.

So if someone offers to consolidate your loans for a fee, you know you’re not dealing with one of the U.S. Department of Education’s consolidation servicers.

Research before consolidating loans.

Consolidating loans might seem like a great idea, but research first to make sure you’re not giving something up. The original loan could have benefits, including interest rate discounts, that would significantly reduce the long-term cost. You might lose those benefits if you consolidate.

Visit http://loanconsolidation.ed.gov or www.studentaid.ed.gov/repay-loans/consolidation for more information.

Only borrow what you need.

Students should borrow only as much as they need to assist with educational expenses, Wilson says. Those expenses include tuition based on 15 credits per semester, room, board and books. CMU establishes a reasonable room and board allowance for off-campus living, Wilson says.

A tip for future students:

“Start looking for scholarships your senior year in high school,” Wilson says. “That should be your job that year. The return can be good, if you’re diligent and you start early.”

Ask questions.

“I don’t think we hear from students enough,” Wilson says. “We don’t have a high loan default rate at CMU, so students are obviously doing what they should. But there are so many payment options out there, it can get very confusing. We would love to talk to students more.”

Keep in touch.

“Just because you’ve graduated doesn’t mean you can’t still call us,” Wilson says. “If you’re having a problem with your loan, we can help you figure out who to call.

“We’re still here for you.”

Central Michigan University • 1200 S. Franklin St. • Mount Pleasant, Mich. 48859 • 989-774-4000