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Student Loans vs Everything Else

March 28th, 2020 at 01:12 pm

Hi all

So student loan interest has stopped for six months.

I’m debating on stopping my loan payments for the six months as well and going full ham on the principal of one of my loans.

What I mean is, my payments are income driven, one is $69 the other is $99. If I stop the payments, I can take any extra money I have, plus what I would have been paying and dumping it on the lowest balance. I can also, take the stimulus check and throw at it.

If I stick to the plan, I can dump approximately $6,000 by December to the principal of the loan. This is about $2,000 less than the interest accumulated. This would mean though, not paying extra on CC10. Interest on these loans is about $200 a month 🙄🤦🏽‍♀️.

Or I can stop the payments, pay off CC10 I’d say by June/July and then tackle the student loan paying approximately half of what I estimated above.

I also decided not to refinance the house, I pay an extra $100 a month anyway. This extra $100 is not negotiable unless something happens like job loss. Given my position this is not something I’m overly concerned with. Thank God.

Just wanted your thoughts.
Oops my only debt is the mortgage, student loans and 1 credit card.

Posted in Debt | 13 Comments »

13 Responses to “Student Loans vs Everything Else”

  1. creditcardfree Says:
    March 28th, 2020 at 01:48 pm 1585403302
    1585403302

    What are you referring to Amber? It's not clear what you are asking.

  2. Lots of Ideas Says:
    March 28th, 2020 at 02:27 pm 1585405634
    1585405634

    Amber, as long as you feel your job is secure, it makes sense to keep paying your bills.it actually helps the economy if those who can afford to pay do so.

    If you think you might not be secure, then maybe save the extra for now and make a bigger extra payment when this all ends.

  3. Amber Says:
    March 28th, 2020 at 03:47 pm 1585410473
    1585410473

    Sorry CCF, it looks like my post didn’t post in its entirety, I’ve updated. Not sure how that happened

  4. MonkeyMama Says:
    March 28th, 2020 at 05:43 pm 1585417385
    1585417385

    Amber, what are the interest rates on all of your loans? I'd say it depends on the interest rates. & is your home loan for 15-years or 30-years?

    I would personally not defer any payments if I was gainfully employed. Will have to be paid back at some point, interest continues to accrue, etc. As you are well aware with the student loans. But if you can utilize the situation to knock out some higher-interest debt I would absolutely do so.

  5. creditcardfree Says:
    March 28th, 2020 at 08:29 pm 1585427391
    1585427391

    Am I correct there is no penalty for stopping your student loan payments? And I believe these are valid only for 60 days. So we are talking about two payments of $168, or $336 total over 60 days.

    Since you are employed, I would just consider the bonus of this scenario that all of your payments go to principal during this period of time. I believe your focus has been CC10 primarily, so I would dump the stimulus check on that and keep hustling to get that paid off.

    As always I suggest using debt calculators to figure out a pay off plan and stick to it as much as possible. Make a plan, work the plan.

  6. Lucky Robin Says:
    March 28th, 2020 at 08:37 pm 1585427836
    1585427836

    I'd still stick with your original plan. It works for a reason.

  7. terri77 Says:
    March 29th, 2020 at 12:57 am 1585443466
    1585443466

    I think everyone up to a certain income. Singles up to $75k get the full amount then it phases out at $99k. Double the amount for married couples. $500 for each child under 17.

  8. Amber Says:
    March 29th, 2020 at 01:24 pm 1585484651
    1585484651

    I’m going to continue with the plan, pay off CC, keep paying student loans as is, since I am employed. Student loan is interest free for six months.

    My attorney owes me a refund, so I’m calling her to release the funds. I had originally asked that she keeps it for a few months, in case my brother popped back up, but I’ll use this money towards knocking CC10 out, since it’s been two months and nothing.

    I know that for those who make $75k or less, I barely didn’t go over this, will receive a check, I’m not sure what happens after that.

    This is so new to me I’m utterly confused and just trying to make sure I’m well informed before doing anything.

  9. MonkeyMama Says:
    March 29th, 2020 at 05:47 pm 1585500432
    1585500432

    I think you could be very well served refinancing both your student loans and your mortgage. It's all about decreasing the interest. But, there is certainly no rush and interest rates are expected to fall further, or at the least to stagnate for a while.

    I see the value in getting the credit card paid off and then focusing on the bigger loans. I asked about the mortgage term because the rates are even lower on 15-year loans and this might be an opportunity to refi to a 15-year term if you don't already have a 15-year loan.

  10. creditcardfree Says:
    March 29th, 2020 at 08:41 pm 1585510882
    1585510882

    Ah interesting I wonder what site I was on that said 60 days for student loan interest? Good plan Amber, and I think wise advise from Monkey Mama. Lowering interest rates is key in addition to make more than minimum payments to pay off debt faster than scheduled.

  11. lena Says:
    March 31st, 2020 at 10:52 am 1585648350
    1585648350

    good post.

  12. eva Says:
    March 31st, 2020 at 10:53 am 1585648432
    1585648432

    good and nice post.
    Text is aboutdogfence and Link is https://aboutdogfence.com/
    aboutdogfence

  13. MonkeyMama Says:
    April 1st, 2020 at 03:01 pm 1585749703
    1585749703

    As an aside, I saw an article recently that said deferred loan payments will likely end up being reported to credit agencies as "missed payments" in many cases. Just FYI. I am otherwise 90% in the "credit score doesn't matter" camp, but often it does matter (for non-borrowing reasons). It certainly matters if you want to take advantage of low interest rates on some of your larger loans.

    I think you already decided not to defer, but thought this was a good general FYI.

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