When it comes to paying for college, there are several financial aid opportunities available, including student loans. For larger loans you'll normally want to turn to the larger student loan providers as these institutions can give you the tens of thousands of dollars you might need per semester. However, when you need additional money to offset these loans or if you need smaller student loans, you can turn to banks and other more traditional financial institutions such as Wells Fargo. If you're taking out Wells Fargo student loans, you need to know the details about these loans and how to pay them off.
In general, it's best to pay off private loans before your federal loans as there are a number of federal loan forgiveness programs available. It is also easier to refinance your federal loans. With private institutions, your loans are not as regulated, so you'll want to pay these off faster.
If you have taken out Wells Fargo student loans in the past, there are a few different options available to you for paying it off. You'll want to keep all of your options open so you know exactly what to expect during the payment period.
What Are Wells Fargo Student Loans?
Wells Fargo student loans are loans handed out by Wells Fargo to help pay for higher education. The only way you can apply for such a loan is if you are enrolled in a college, university, or trade school. When applying for the loan, you will need to provide proof of enrollment. The best way to do this is to work with your school's bursar's office to determine how much additional money you need to pay for your courses.
After you enroll in your university classes, you will receive a bill for the cost of the semester. As you enroll in advance, you will have enough time to apply for funding through your lender of choice. When applying for your Wells Fargo student loan, simply provide the billing information sent to you from your school.
Wells Fargo Lending Methods
Depending on the student loan you're applying for, the money may go directly to you first, allowing you to pay the college. In other cases, the money will go directly to the school. The best option depends on what you intend on using the money for. If you want to use the money for tuition, it is easiest to have the money go directly to the school. This is faster since you don't have to get the money, then pay the school. However, you may want to use the money for books or housing while in college.
As Wells Fargo student loans are more commonly used as subsequent loans to offset other forms of student loans, scholarships, and grants, you may already have enough money to pay for your tuition. However, you may need additional funds for room and board. In this case, you can have your Wells Fargo student loan money come directly to you. Sometimes, though, the money must go to the school. Whatever money is then left over will be sent to you once all of your tuition bills are paid.
Amount Received and Interest Rate
When applying for a Wells Fargo student loan, there is a cap on the amount of money you may receive. There are several factors at play when it comes to determining how much you can receive. This includes the amount of your other student loans, the amount of money your college courses cost, and your credit and the credit of any co-signer.
If you are in high school or in the early years of college, you likely do not have the credit score required to receive an excellent interest rate for your student loan. That is why it's almost always better to have a co-signer such as your parent or older sibling to sign on for the loan. Even if this doesn't affect the amount of money you're able to receive, it will have an impact on the interest rate you're granted. That can greatly reduce the amount of money you have to pay back. Even a small drop of only a percentage point or two may save you thousands of dollars over the course of your loan.
How Can You Pay Off Student Loans?
The faster you're able to pay off your student loans, the better off you're going to be, and the more money you'll save. However, there will be some payment methods you're just not able to take advantage of due to your current financial situation. Wherever you are and whatever situation you find yourself in, try to use as many of these different ways to pay off your student loans.
Paying Off Interest While in College
When you receive your Wells Fargo student loan, you will have a few different methods for paying it back. First, you can begin paying back the interest as soon as you receive the loan, or you can put off paying on the interest until after you finish school.
There are advantages to both options. First, if you put it off, you won't have to worry as much about your finances while you're in college. This way, you can focus on your studies. However, the downside to this is the interest will continually build up. The amount of money you have to pay back might very well be thousands of dollars more by the time you're done with college. If you're able to, it's best to pay the interest on your loans while you're in college, at least on your Wells Fargo student loans.
Pay More Than the Minimum
You are given a minimum amount you must pay to your Wells Fargo student loans every month. If you pay the minimum, you'll end up paying on your student loans for the entire agreed-upon period. This may be anywhere from 10 to 30 years. That's a long time to pay back your student loans.
If you can, pay more the minimum every month. Even if it's just a few extra dollars, this really adds up over time and can help cut down the time you'll pay on the loans and the amount of money you'll pay.
Put Those Cash Bonuses Towards Your Loans
Whether you receive extra cash during the holidays or your work gives you a bonus at the end of the year, you'll be better off putting this extra cash towards your student loans. No, it's not fun or exciting to put the money towards your student loans, but it is financially responsible.
It may feel like you're spending your money on nothing since you don't get anything tangible out of it. However, the faster you pay off these student loans, the better off you'll be financially, and the faster you can get out of debt. The faster you're out of debt, the sooner you can begin spending your money on other things such as vacations.
Target Your High Interest Loans First
Whenever possible, your best bet is to pay off the high interest loans first. Your Wells Fargo student loans may not be the only loans you have. Even if you only took loans out through Wells Fargo, you probably have a few different ones. These different loans will have different interest rates. Target the loan with the highest interest rate and pay more on this before the other loans. It'll help you save more money in the long run. When paying your student loans back, you want to cut your overall expenses as much as possible, and that means paying off high interest loans quickly.
Use Auto Pay
Some student loans provide discounts for setting up automatic payments. This means the money comes directly out of your bank account every single month. This way, the lender does not need to come after you for payments. Instead, the money comes out every month automatically. By using such a service, your interest rate may be lowered by a quarter of a percent or so. It may not seem like much, but it does add up.
Another benefit to auto pay is that you don't have to remember to may your student loan payment every month. This means it's less likely that you'll forget and miss a payment.
Should You Consider Refinancing to Pay Off Your Loans Faster?
Over time, you'll build up your own credit. As long as you stay on top of your monthly debt, you'll improve your credit score. This means you'll be able to potentially reduce your interest rate by refinancing your student loans.
When you refinance your Wells Fargo student loans, you might chip off half a percent or more from your interest rate. This can reduce your monthly payment by a good amount. You can also consider shortening the term of the loan. For example, you might refinance from a 20 year loan to a 15 year loan. The monthly payments will be higher, but the interest rate will be lower. Overall, you'll pay less in the long run.
There are several ways you can pay for college. One such option is to take out Wells Fargo student loans. These loans can be very helpful in paying for tuition, room and board, and other expenses. Just make certain you carefully manage your loans and pay them back in the best way possible.