How to Pay Off Student Loans Fast? [5 Effective Ways]

Student loan debt is one of the biggest financial burdens for individuals in the U.S. If you are finding it hard to meet the student loan payments, you are not alone. 

In fact, the Federal student loan debt amounts to $1.6 trillion currently. And if you are one of the 43 million borrowers, you may be wondering how to pay off student loans fast.

Turns out, there are many ways to better cope with your student loan debt while managing other financial obligations. Continue reading to find out some really helpful financial strategies to pay off student loans fast.

How to Pay Off Student Loans Fast?

One of the most effective ways to pay off student loans is by paying more than your monthly minimum. The more you pay, even if it is a small amount, the less interest you’ll be required to pay. As a result, your student loan balance will go away more quickly. 

There are many other strategies to pay off your student loans faster:

1. Sign Up for Autopayments

To pay off your student loan faster, consider opting for autopayments. Autopayments on student loans reduce the loan’s interest rate, which means you will be making higher payments toward your principal balance.

When you allow federal student loan servicers to automatically deduct loan payments from your account every month, they offer a discount of about 0.25% on the interest rate. 

Although these savings would be minimal, they can still help you pay off your loan faster, especially if you combine this strategy with the others mentioned in this guide. You can check if your loan servicer offers an autopay discount by contacting them.

2. Refinance Your Student Loan

Another way to pay off your student loans faster is by refinancing your loan at a lower interest rate. Refinancing allows you to replace your student loans with one private loan. You can also choose a loan with a shorter loan term than your current student loan term to repay your loan faster.

However, do note that a shorter loan term means higher monthly payments. But in the end, you will end up saving on interest and paying off the debt faster. 

You will also need to check your credit score before refinancing your student loan. Lenders often prefer borrowers with a credit score of 650 or above for refinancing. They will also check whether you have a stable income and a good debt-to-income ratio before approving your refinancing application.

Note: If you are planning to apply for the Public Service Loan Forgiveness (PSLF) or income-driven repayment programs, do not refinance your student loan.

3. Get a Part Time Job in Your College

Another way to pay off your student loan faster is by getting a part-time job in college. You can easily manage a part-time job when studying in college and then use those earnings to pay for your education, reducing the total loan amount that you borrow.

Go to your college’s website or career center to find out if there are any vacancies open for on-campus jobs. You can easily manage these jobs according to your class schedule. You can even take summer jobs during your semester break to earn more.

You can also look for freelance jobs online to limit the amount of money you borrow in student loans. There are tons of freelance opportunities online in various fields for you to choose from. You can work at your desired pay rate and during the hours of your choice as freelance opportunities are very flexible.

4. Seek Loan Forgiveness

You can also seek loan forgiveness to get your loan completely or partially forgiven. However, all of these programs have very strict requirements and approval standards.

If you are applying for the Public Service Loan Forgiveness (PSLF) program, you will need to hold a full-time public service position in a non-profit or government organization. You will also need to make 120 monthly loan payments, have the right types of loans, or have consolidated other loans.

You can also get some of your student loans forgiven if you are on an income-driven repayment forgiveness program. When your 10-year, 20-year, or 25-year repayment term ends, all the student loan balance that remains will be forgiven. 

The Teacher Loan Forgiveness program is yet another way to get your student loan forgiven. To qualify for it, you should have the correct type of direct loan program and you should teach full-time in a low-income school or educational institute for 5 consecutive years.

5. Use a Personal Loan

Last but not least, you can also take out a personal loan to pay off your student loan. However, most lenders may not allow that as money loaned for paying off student loans requires extra requirements that lenders need to comply with. 

If their personal loans do not comply with the criteria of the Higher Education Act, you won’t be able to use a personal loan to pay off student loan debt.

However, you can still find some lenders that will allow you to pay off your student loans with a personal loan. Just make sure to check the terms and conditions of your lender before applying for a personal loan. 

Conclusion

So that’s all, folks! Now that you know how to pay off student loans fast, we hope these financial strategies help you pay off your loans faster. Just make sure to not delay your monthly payments as they will pile up every month and become almost impossible to pay off. 

If you have a good credit score, you can also get a personal loan with a lower interest rate to pay off your remaining student loan.

Apply for a personal loan in Pleasant Grove or anywhere in Utah today by filling out our quick application form. At Cash in Minutes, we offer the most competitive interest rates in Utah and also have very easy repayment terms. And the best part? We accept bad credit!