New analysis: Five habits of successful student loan borrowers
April 01 2015 - 8:00AM
Student loan borrowers who don't postpone their payments and who
track their progress, graduate, stick with repayment, and
communicate with their servicer increase their chances of
successful repayment, Navient found in a recent data analysis. Most
importantly, these five characteristics translate into actions that
virtually every borrower can take to help ensure he or she is on
the path to successful repayment.
"Our most successful customers set themselves up for positive
achievement by taking an engaged approach to managing their loans,"
said John Kane, chief operating officer, Navient, the nation's
leading loan management, servicing and asset recovery company. "The
path to success is marked by informed and proactive borrowers
rather than limited to high-earning borrowers. Navient offers free
resources to help all consumers learn more about steps to
successful student loan repayment and other personal finance
topics."
In celebration of April's Financial Literacy Month, Navient
encourages all student loan borrowers to consider adopting these
five habits for success:
1. Don't put it off. Education
loans have a variety of deferment and forbearance options that can
help you if you truly need a break from payments. By keeping these
options to a minimum, you can reduce the cost of your loan and
shorten repayment periods. Borrowers who use less than six months
of forbearance are nearly twice as likely to successfully repay
student loans than those who postpone longer.
2. Stay connected. Borrowers
who track their progress tend to be more successful in loan
repayment. Regularly logging in to your online student loan account
ensures you're up-to-date on your balance, makes it easy to explore
or renew payment plans, and get information for tax time or other
needs. Also, keeping your contact information up to date ensures
you and your servicer can reach each other easily.
3. Graduate. Graduation is
the most important step toward realizing the value of your
education, so, if you're still in school, stay on track to
completion. If you didn't finish your degree, you can still
take other steps to actively manage your finances and find the path
to successful loan repayment. If college is still in your future,
build a plan to pay for your degree so you're sure to graduate.
4. Stick with repayment. The
longer you are able to make payments on your student loans, the
more likely you are to succeed. Continuing to pay something –
even if it is a small percentage of income – is a factor in
repayment success. Missing payments can damage your credit and lead
to higher costs.
5. Talk to your servicer.
Student borrowers who reach out to their servicer when they have
questions tend to be more successful in repayment. If you're
worried about missing your payments or want to learn about other
payment plans, engage with your servicer. In fact, Navient found
that 9 times out of 10 when we can talk to a struggling federal
loan customer, we can help him or her get on an affordable payment
plan and avoid default.
To determine these five attributes, Navient analyzed habits of a
group of 6.8 million student loan customers. The analysis also
found that the amount borrowed was not a critical factor in
borrower success.
For more tips on student loan repayment, visit the Navient Path
to Success online series. This free series, which is open to the
public, details a variety of financial scenarios and other
pertinent topics for recent graduates. Topics include student loan
repayment plans, credit scores and good money-saving practices.
Connect with @Navient on Facebook, Twitter and LinkedIn.
About Navient
As the nation's leading loan management, servicing and asset
recovery company, Navient (Nasdaq:NAVI) helps customers navigate
the path to financial success. Servicing more than $300 billion in
student loans, the company supports the educational and economic
achievements of more than 12 million Americans. A growing number of
government and higher education clients rely on Navient for proven
solutions to meet their financial goals. Learn more at navient.com.
Navient began trading on Nasdaq as an independent company on May 1,
2014.
CONTACT: Media:
Nikki Lavoie, 302-283-4057,
nikki.lavoie@navient.com
Patricia Nash Christel, 302-283-4076,
patricia.christel@navient.com
Customers: 888-272-5543
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