Education loans have been known in Singapore for many years and a lot of students who are having a hard time supporting their studies would instead apply for an education loan than to stop chasing their dreams.
Although education loans have brought a lot of help to students, there are still borrowers who had bad experiences with student loans and one of the reasons why is where they aren’t able to pay their education loan right away thus they are now facing a huge debt from the licensed moneylender..
Are you postponing repayment?
Are you planning to postpone your education loan repayment? Even if you want to enjoy the salary you’ve been receiving from your new job after graduating from college, it is still very vital for you to follow your repayment terms.
There are several consequences you will be facing if you are going to postpone any loan repayment. Having an outstanding loan would make it harder for the borrower to pay the loan. Loans have their interest rate, and if you are not going to pay your loan on time, your loan would grow over time and could even triple your original loan amount.
Aside from having a growing loan, postponing your loan repayments can also affect the school where you are studying. Banks have been monitoring schools where their borrowers study, and if they can see that a lot of borrowers from that school aren’t following their repayment terms, they can be charged with sanctions.
Because of this problem, schools have been hiring consultants that would talk with the borrower and help them manage their education loan. They also have their loan forbearance where you can temporarily stop your loan repayment.
If you apply for loan forbearance, you can continue paying your loan whenever you already have the money and job that could sustain your loan repayments. Although there would still be an interest for loan forbearance, some would also go for it because it has a lower interest rate compared to just neglecting your education loan.
Run away from loans
Some borrowers thought that if they run away from their loans, the banks and money lenders won’t chase them but what happens to them is that they would be shocked that their loans became a serious problem to them.
Supposedly, a student loan would help us in having a better life through attaining a better future from a high paying job but what others experience after they had a student loan and finishes their studies is that they are now facing a bigger problem and that is all because they didn’t face their loans properly.
Banks and licensed money lenders usually give borrowers a chance to pay their loan yet there are hard-headed borrowers that instead of paying their student loans, they would opt to run away from it, thinking that it would solve their problem.
Student loans usually have a low interest rate, but if you are going to pay your student loan very late, you would expect that the interest has grown too much already. Some borrowers who didn’t pay their loan immediately and waited for the bank to take things seriously found their loan to be multiplied three times their original loan, and that is a big consequence for those who didn’t pay attention to their loans.
Aside from having your loan grow bigger, another problem, if you will run away from your loan, is that there is a possibility that the bank will face this matter legally.
What if there is no loan forgiveness?
Some banks offer loan forgiveness to those borrowers who would face their student loan. Through loan forgiveness, the bank can adjust your interest rate especially for those borrowers who took several years to come back and pay their loan.
Not all the time there is loan forgiveness, there are instances when a borrower won’t be granted for loan forgiveness particularly if they have a problem with their loan. One example of this is when you have a problem with the type of student loan you have applied. This is not new in loan forgiveness thus if you wanted to avoid these, you shouldn’t wait that your loan would come this far.
Supposedly, student loans are paid within five to ten years after you graduate, but because of your unpaid student loan, you still have to endure paying this loan longer with a bigger interest rate which is not easy for a borrower.
With this article, you can see how we should value the education loan we obtained. Being able to be approved for an education loan and continue your studies is already a big opportunity that is why we should also face our loans properly to avoid conflicts in the future.