[Clara]

Hello,

I have a question, My husband has a 40k student loan that we have to start paying off next month. Our payments are over 500 a month ( i don't know how anyone is expected to save anything with that kind of payment). We have 10k of that money that we had in a CD that we will be paying back to try to bring down the amount. Is there any other FINANCIALLY SMART way to bring down the interest rates? I don't necessarily want to use one of those consolidation companies, bc it seems like a scam and I'll be paying a lot more in the end. We are smart people with no other debts that just want to find the best way to handle these loans without falling into any traps.

[Fer]

The Interest rates on student loans are usually lower than any debt consolidation company offers.and you won't get a reduction in the principle on a student loan anyway.

that said, call the servicing company and ask them if your scheduled monthly payment will decline if you are able to make a substantial payment [your 10k]. if their first answer is "no", ask if there is a refinance program you can get into if you can come up with a substantial payment.

you do not have to tell them you have 10 k in cash. Let them think that you've received some bit of property or rights from an elderly relative that can be sold.

part of the game is to control the interest costs while increasing your financial flexibility ... that means lowering the required monthly payment.
Source: ex-banker and cpa

[Jaime]

I'm not sure what your husband does as a career or wirk, I know my sister got lucky and got a grant because she worked for the state, not sure if that is a good option for him. Her grant paid her student loans off. For service for 2 years working for the state. Best luck