Paying Back Federal College Loans
My daughter is currently a freshman in college in Illinois and has taken both subsidized and unsubsidized federal loans. She would like to start making small payments towards the loans. Which loan should she start paying off first? The subsidized loan is higher but since the unsubsidized loan is already incurring interest, she is planning on paying off the interest on the unsubsidized loan first. If she can pay more than the interest each month, should she apply it to the unsubsidized loan or subsidized loan? Thanks!
Terry Says
If she is still in school, she should pay the maximum possible on the subsidized loan. Make sure the lender applies it to the PRINCIPAL of the loan and get confirmation in writing.
Great work. Please write back and tell me how she is managing to pay down her debt while still in school! I’m sure others would like to know!
