When the interest on your federal student loan is not paid as it accrues during periods when you are responsible for paying the interest, your lender may capitalize the unpaid interest. This increases the outstanding principal amount due on the loan.

Student loans don’t go away after 7 years. There is no program for loan forgiveness or loan cancellation after 7 years. However, if it’s been more than 7.5 years since you made a payment on your student loan debt and you default, the debt and the missed payments can be removed from your credit report.

Is there a benefit to paying off student loans early?

A big advantage to paying off your student loans early is the ability to save a significant amount in interest. Early payoff gives the loans less time to accrue interest, which means you’ll pay less money in the long run. Continua a leggere