Interest capitalization. Interest can add up quickly on student loans. All of the interest that accrues on your unsubsidized loans while you are in school can generally be capitalized (added to your principal loan balance) by your lender, and interest will then be charged on that new, higher loan balance. Any payments that you are able to make to pay that interest before it is capitalized, whether you can pay all of it or just a portion, will reduce your overall loan costs.

Repayment plans. Federal student loans, and some private loans, offer several different structures of repayment plans. Your lenders will have details about the plans that they offer.

When you are evaluating repayment plans, consider:

• The monthly payment amount,
• How long it will take to repay the loan, and
• The total amount of interest that you will pay.

Low payment amounts are very tempting, but remember that they can cost you a lot in the long run. In general, select the plan with the highest payment amount that you can reasonably afford in order to minimize your loan costs while keeping the payment manageable. Remember that you can always make additional payments when you have extra cash.

Many lenders and other organizations offer loan calculators to help you estimate your monthly loan payments, amount of interest you will pay, length of repayment term, and other factors related to your loans.

Quick tips for successfully managing your loans:

• Notify your lender of all address, phone, and email changes.
• Open all mail (postal or email) from your lender.
• Make all payments on-time.
• Make additional payments when you can, whether a little each month or a lump-sum payment. Even an extra $10 or $20 each month will cut your total interest costs.
• If you have difficulty making your loan payments, contact your lender immediately.

Federal loans offer several repayment options that may make your payments more affordable. Under some circumstances, you can even temporarily postpone your payments for short periods of time.

Remember, nobody wants you to default on your loans, and your lender, guarantor, and the OCOM Financial Aid Office are here to help if you find yourself struggling to manage your loans.