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Serving A Terrible Blow to The Idea of Fast Cash Online, Justice Supported the Debt Collection Companies in The Debt Collection Case

On Monday, it is ruled by a divided Supreme Court that no one can sue the debt collection companies if they attempt to recover credit card debt of years old from those who look for bankruptcy protection. To be more specific, according to the Supreme Court, no debt collection companies can be sued while trying to recover their years-old debt of credit card from people seeking bankruptcy protection. The justices ruled this verdict 5 – 3 in favor of the Midland funding. Though the fast cash online seems to be a great solution to get quick cash, still, with this new verdict being ruled, the consumer groups have received a terrible blow.

Yes, the 5- 3 ruling is nothing less than a shock or a serious blow to the consumer groups, who often complain about the debt collection companies to mislead people unfairly into repaying the old debts, even though the consumers are not required to do so under the law.

The court finally sided with the Midland Funding on Monday. Midland Funding is a debt collection company that was trying to recover a debt of around $1879, which have incurred by an Alabama woman for more than around 10 years ago.  The name of the Alabama woman is Aleida Johnson who had argued that the debt collection company named Midland Funding was totally wrong to try to collect the debt. She also stated a reason behind her claim. According to her, the company has wronged because as per the law of Alabama, there is a six-year limitation statute for a creditor for collecting the overdue payments.

Based on this very reason, Aleida Johnson had successfully avoided paying the debt of $1879. According to a federal appeals court, Aleida could have sued the debt collection company for attempting to collect the debt, based on the existence of Fair Debt Collection Practices Act. It is based on this Fair Debt Collection Practices Act in Alabama that a money collection company can be sued as according to the Act, all the money collection companies are strongly prohibited from making any misleading, deceptive and false representation in any way or trying to recover the debt by any unconscionable or unfair mean. This particular law prohibits any attempt of the collection companies in trying to collect the debts outside the statute of limitations, which is, in this case, is around six years.

However, according to Justice Stephen Breyer, this Act doesn’t apply in case of bankruptcy proceedings. Yes, writing for the majority, and breaking with his liberal colleagues, Justice Stephen Breyer confirms that any effort made in order to recoup years old debt during bankruptcy do not violate the law or the Fair Debt Collection Practices Act in any way. He said that the attempts made by the money collection companies were neither misleading nor false as technically the bankruptcy law supports such claims.

Breyer also added that the attempt of recovering the debt by the money collection companies, such as in the case of Midland Funding, was neither unconscionable nor unfair, as a bankruptcy trustee definitely can object to claims which are so much old that they no longer have to be repaid. And it is exactly what happened in the case of Johnson’s, which also reduces the concerns of that of the consumers might unwillingly pay a years-old debt.

Justices Anthony Kennedy, Samuel Alito and Clarence Thomas along with Chief Justice John Roberts also joined the opinion of Breyer. Though, Justice Sonia Sotomayor considered the practice to be both unconscionable and unfair.

According to Sotomayor, professional debt collectors and providers of fast cash online, have built a business out of filing unfair claims in bankruptcy proceedings to collect the debt and buying stale debt, assuming that no one noticed it. The dissent passed by her was also joined by Justices Elena Kagan and Ruth Bader Ginsburg, while Justice Neil Gorsuch preferred not to participate in the case.

Mr. Cordray, It’s Time to Step Down to Let Payday Loans Online Providers Breathe

CFPB or the Consumer Financial Protection Bureau is a controversial agency and continues to remain polarizing. The US Court of Appeals for the District of Colombia recently declared that the structure of 1 director followed by the bureau is unconstitutional. In light of the criticisms and the voters’ desire for a modification of the status quo, CFPB need to refrain from pushing regulations about payday loans online providers before the presidents enters his office.

It is common trend for federal agencies to implement some last-minute regulations when a new administration takes over the government. These regulations are usually rushed and supported by low quality assessment of the benefits and expenses. Since CFPB’s regulation can influence the financial well-being of tens and thousands of Americans, they should take time and act in good faith.

For instance, the proposed regulations on payday lending and arbitration have sparked a lot of public interest. 1.4 million comments have been received by the payday rule, which ranges from legal and economic analysis to people’s personal stories about how they quite terrified about losing access to important products and services.

The CFPB needs some time to carefully consider and reply to genuine concerns highlighted by the commenters. The staff of the bureau will really need to work 24/7 to be able to sift through, review and analyze the 1.4 million comments internally before the new administration takes over the reins of the government. Scrutinizing the comments of the arbitration rule is going to take some more time. The bureau’s proposed rule on arbitration and payday lending is going to influence significant change in the financial services market and affect so many consumers, along with their accessibility to credit. The bureau should give it the attention and time that it needs.

CFPB need to exercise control to get the rules right and to maintain legitimacy. Originally, the bureau did not have any accountability to the president and the Congress. Its structure was recently held as an independent agency by the decision of a federal appeals court. The court even said that the director of the CFPB is the single most powerful official in the entire US government, next only to the president.

The problem was addressed by the court and it gave the president the power to sack the director for various reasons other than neglect of his duty. The president has the authority to oversee the work of the CFPB and fire the director, just like for any other agency.

The CFPB also need to avoid taking aggressive actions for the interest of legitimacy until the new president decided on who he wants as director for the bureau. The future of CFPB is uncertain, and therefore, any new rules will be viewed as an invalid attempt to dictate policies. This can lead to the rules being overturned by the new administration and can cause even more uncertainties in the industry.

Instead of putting the financial industry under whipsaw policy, the bureau and its director need to step away from the pen. CFPB should spend some time to work through the information that it has received as response for its proposed rules. This way, the new administration will be able to make better, informed decisions. The major goals of the bureau is to protect the customers and promote innovation and access in financial products and that does not change. The best way for the bureau at this moment is to wait before inaugurating and announcing the final policy regarding payday loans online industry. They need to really take the time to evaluate and assess the whole situation.

Calls for the Elimination of the CFPB Continue to Increase

The Consumer Financial Protection Bureau (CFPB) has certainly made its fair share of headlines over the past few years. From its moves to make debt collections agencies more transparent and accountable to their more recent proposed payday lending rule, the CFPB has managed to maintain a vicelike grip on various sectors of the financial industry. A government organization doesn’t do the kinds of things the CFPB has been known for without amassing its share of detractors and opponents.

For a while, there were only a few individuals or organizations that were vocal about wanting to limit the power of the CFPB. Now, though, there are increasing calls for the Consumer Financial Protection Bureau to be done away with once and for all. Whether or not that will happen is something we’ll all have to wait and see. However, it is interesting that this pet organization of President Obama’s is becoming the target of increasing complaint, as Obama prepares to leave office in the very near future.

The CFPB was created as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. It has, since its inception, morphed into one of the most unaccountable and powerful agencies of the federal government over the past five years. This agency has a staff of more than 1,000 people and a nearly limitless budget. The CFPB has taken steps to restructure the mortgage industry, put restrictions on the major credit bureaus, change student loans, and to effectively destroy the payday and title lending industries. This massive amount of control of seemingly every type of financial business seems to be a huge overreach and has already led to the demise of more than a few legitimate businesses in this country.

The thing is, the CFPB seemed to be designed to get around the standard checks and balances that most other regulatory agencies deal with from the very beginning. From the top down (and don’t forget, the CFPB is headed up by a single director, and not a bipartisan committee) the CFPB has handed down decisions that make American consumers seem to be like children, who have no idea how to handle financial transactions on their own. The CFPB has been called by some just another attempt by the government to create a nanny state.

When the government makes it a point to meddle in the financial marketplace, there will always be serious consequences. With regards to the CFPB, our laws are being superseded by the whims of a powerful, yet unaccountable agency that is controlled by a single person; an unelected one, at that! The actions that the CFPB continues to take most certainly lead to consumer-level uncertainty. New regulatory statutes handed down by the CFPB will likely wind up costing consumers more while reducing their options for financial services and products.

The lawmakers in this country need to get started with reining in the CFPB immediately. It may start by curtailing the agency’s power a bit. Completely getting rid of the CFPB would likely be the best option for everyone. Protecting consumers is best handled when multiple agencies work together and coordinate their actions. Let’s face it, there are already enough government agencies that were tasked with handling the things that the CFPB now has power over, and these agencies did a better job than the CFPB has been doing as of late.

With a change in guard coming to the White House, it is time for the CFPB to be reevaluated, put in check and potentially disbanded altogether. Failing to do so will likely lead to more financial headaches for small financial businesses and consumers.

Latest CFPB Payday Regulations are not as much of a Slam Dunk as the Bureau Believes

As you probably already know, the Consumer Financial Protection Bureau has introduced a new rule that the Bureau believes will effectively put an end to what they call “debt traps” that consumers allegedly wind up snared in due to the payday lending industry. The regulation is more than likely going to be challenged by payday lending advocates, some political leaders and those who work in the payday lending industry. There are many opposed to not just the new regulation, but the Consumer Financial Protection Bureau itself. There are charges being leveled that the CFPB, an arm of the United States government, is unconstitutional in its structure and that it lacks the official authority to implement any type of regulations on the short term lending industry.

When considering the CFPB and its new payday lending rule, it is important to consider not just the structure of the regulation, but the potential obstacles that the Bureau is likely to face in getting the new rule pushed through and made official. There are questions that interested parties need to consider.

How will the proposed payday lending rule actually protect consumers from falling into “debt traps” that some people associate with the payday lending industry? The rule is very comprehensive. To read through all of it, you’d have to be prepared to scour over 13,000 pages. But for all of the details covered in the rule, the descriptions for what makes up an actual payday loan are a big generalized. Some types of short term loans are covered, as well as some longer-term loans. Lenders who make these types of loans will need to comply with the newly created ‘ability to repay’ requirement covered in the rule. This is something that mortgage lenders and credit card companies have had to adhere to for a long time, but is new for short term lending institutions.

This requirement will force lenders to look into the potential borrower’s income, debt situation and then find out whether or not additional debt will work for the borrower. Will the person be able to make the loan payment with their existing debt level? Additionally, this rule forces lenders to consider everyday expenses, like food, utilities and other expenses that borrowers have to deal with. Here’s where it gets sticky – the lenders have to not only make these inquiries, but they have to verify all of the information. This means they will need to get paycheck stubs, credit reports and other documentation about each and every person they have to process loan requests for. These additional checks will likely make the costs of making loans so high, and the overhead costs of running a lending company so unmanageable, that many lenders will have to drop out of the market.

Will the rules even provide new levels of protection to American consumers?

Some experts believe that the new rule will prevent borrowers from “rolling over” too many loans, and that this will prevent people from getting into situations where they are rarely able to realistically pay off the principle of their short term loans. However, the elephant in the room is the fact that if the new rule effectively closes the doors of the majority of payday lending companies, then lower income borrowers, and people with low credit scores will have virtually no access to emergency lines of credit. The traditional banks are of no help to consumers with low incomes and subprime credit when those people need to borrow a few hundred dollars to keep their heads above water. By protecting consumers from loans that they don’t like, while potentially preventing those same consumers from getting access to short term lines of credit, the CFPB has shown that they have not paid a whole lot of attention to creating any type of rule that would benefit American consumers in a realistic manner.

Making Smart Credit Choices: Requesting a Credit Limit Increase

People often get their first credit cards when they are young and have not quite established themselves financially. As such, it is easy to understand why so many people find themselves with lines of credit that have very low limits. It is not unusual for credit card companies to give new account holders lines of credit that are only for $1,000 or a little bit more. As people begin to progress a bit with their finances, though, they often need credit cards with higher credit limits. This can often prove to be a stalling point for some consumers, as they are not sure how to go about requesting a credit limit increase from their credit card companies.

Use Credit Responsibly

With so many financial experts suggesting that people avoid using credit cards, it may be difficult to understand why some people would want to increase their credit limits. If someone is responsible with their use of credit, though, it is very easy to wind up in a situation every month where they are utilizing a large percentage of their existing credit. Some people like to charge purchases, like gasoline, groceries and other common items, and then to pay off their credit card balance entirely when the payment comes through. If someone only has a $1,000 limit, and spends $500 on the card, they are regularly going to be at 50 percent credit utilization. That is something that can lead to a lower credit score. Suffice it to say, that everyone should use their credit responsibly and should make efforts to pay off their balances in full – or as close to that as possible – every month. Only then, should you seek to get an increased credit limit.

You’re Not Asking for a Favor

People often get intimidated when calling to talk to representatives from their credit card companies. They believe that if they say the wrong thing, they will get turned down flat, or that if they don’t mind their p’s and q’s that they will wind up getting slapped with a higher interest rate or something. Nothing could be further from the truth. You are the customer, and they are making money from supplying you with a line of credit. You never have to feel nervous about approaching a credit card company, be it to ask for a different payment date, to negotiate a lower interest rate or, in this case, to ask for a higher credit limit.

It’s Easier than you think

Most of the time, you will not even have to speak with anyone to get this done. All the major credit card companies have online portals that allow you to access your account. Typically, there is a link that you can access once you are signed in that will allow you to request a higher balance. Use this link. You will be taken to a form that asks you the reason for needing a higher credit limit. For example, the company may want to know if you are doing so to transfer another balance or to make a large purchase. Be honest, and fill out the form entirely. If you qualify, you will get a notification from the credit card company.

However, if you get turned down, you may want to call their customer service department directly. Speak to the representative professionally, and explain why you need a higher balance. If they turn you down, ask to speak to their manager or supervisor, then repeat your request. It may take a couple of calls, but if you persist, and have a valid reason for needing a higher credit limit (like the fact that you are making a lot more money now than you were when you got it, and want to avoid high credit utilization) you should be successful.

The Clock Runs out on Proposed Payday Lending Regulation in Nebraska

A new change to the payday loan regulations in Nebraska – a change that was endorsed in full by the Greater Omaha Chamber of Commerce, along with TD Ameritrade – has died out. This proposal would have changed the payday lending rules in big ways, but will not wind up taking effect any time soon. The bill – 1036 – was introduced by way of State Senator Kathy Campbell from Lincoln. It was designed to cap interest rates on payday loans at just 36 percent. This cap represented a major reduction from where the loan fees – when amortized for an entire year – currently stand.

In addition to APR caps, the bill was also aimed at changing the way debts are collected, while requiring more reporting to be done on the payday lending companies doing business in Nebraska. However, the payday lenders can breathe a sigh of relief, since the overhaul failed to get past the Nebraska Legislature’s Banking and Commerce Insurance Committee. This means that the 60 local payday lending locations in Omaha, and more than 90 throughout the state will operate per usual for the foreseeable future.

Senator Jim Scheer is from Norfolk and is the chair of the committee. He indicated that time was a real factor with regards to the folks supporting this bill. Those same folks met a roadblock when it came to a relatively shorter legislative session. The session this year is 60 days, while the following year will be 90. Session days alternate every year. If the senator does not name a particular bill as being a priority it will more than likely not make it out of the committee. The bill is then to be talked about on the full Legislature floor. Campbell did not indicate that the payday loans bill was a priority.

Sheer said, “It got past the point of being named a priority bill, and without that designation, it had no vehicle to get anywhere on the floor.  It didn’t make much sense from the committee’s standpoint to move it into the general file if it wasn’t going to go anywhere.”

When the 90 day legislative session rolls around there may be more time for discussions and amendments to the bill via negotiations submitted from both opponents and supporters. In a 60 day session, though, lobbyists and other interested parties do not have as much time to arbitrate and come up with solutions. This process proves disappointing to those who have a stake in the proposal.

The executive director of the Women’s Fund of Omaha Michelle Zych said, “Quite frankly, we were really surprised that it didn’t make it out of committee.” Zych’s group was the organization that originally pushed for the new regulations. Her supporters criticized the fees that are currently permitted on Nebraska payday loans. They believe that there are not many other states that will allow these higher rates, and that the fees currently contribute to consumers getting stuck in “debt traps.”

Opponents of the reform, like Brad Hill said that the industry is already sufficiently regulated and that borrowers are stopped from rolling over loans that they cannot afford to pay back in time. Hill then told the hard truth that many people don’t want to hear about: the fact that people who need small dollar loans do not have anywhere else to turn, other than to local payday lending locations or to online lending companies. Time is on the side of the payday lenders in Nebraska, for at least a little longer. Both opponents and proponents of the regulation will likely turn out in force when the time for the 90 day session arrives.

Walmart Announces New Tax Refund Cash Pickup Service

Every year as January comes to a close, people begin filing their tax returns. With this in mind, you can always count on Walmart to do what they can to turn a profit. This time around that profit may come in the form of their new service which allows consumers to forego a cash refund check with the ability to pick up their refunds in cash. As of January 20th this service is readily available and it goes by the moniker Walmart Direct2Cash. This new service promises to save customers money and time in comparison to traditional tax refund services.

Walmart is joining up with TPG, a Green Dot Company, along with Republic Bank & Trust Company, an FDIC member, two leaders in the tax-related financial service industry, to provide the Walmart Direct2Cash as a new option to millions of their customers. There are more than 25,000 tax preparation locations that are using software that directly interfaces with Walmart Direct2Cash, and this service may be provided for no additional fees, other than the initial $7 that is charged when customers file their taxes. Walmart is not charging any fees for refunds claimed at their locations.

Daniel Eckert, the Senior VP of Services for Walmart U.S. said, “know tax refunds can be one of the largest financial payouts of the year for many of our customers, and the last thing they want is to wait for their refund check to arrive and then spend money on unnecessary fees – in many cases upwards of $70 – to cash it. By skipping the check and choosing this new service, customers will not only save time, but also keep some extra cash in their pockets – two things Americans can always use more of.”

People are always looking for more convenient alternatives to the things that they already do. It seems that Walmart Direct2Cash will offer the convenience and security that consumers need, and allows everyday people to get their full refund amounts in cash, instead of a check. The government all too often mishandles refund checks, plus checks that are mailed are subject to theft, fraud and other problems. These issues can cause people to experience delays of weeks or even months while waiting for their yearly tax refund checks. With the ability to simply drop by the local Walmart to get their cash, people have an option that is a heck of a lot more convenient than the traditional refund delivery option.

When people choose the Walmart Direct2Cash option, they can also save a considerable amount of money on fees, compared to what they have to pay for the more traditional tax refund check cashing options. Take, for instance, a person who has received the average tax refund check for $2900, and who chooses to use a check cashing provider that charges 2 percent to cash checks. That fee alone could add $20 to the process of cashing a refund check; an amount that would be avoided if that same person were to use the flat rate fee charged by Walmart Direct2Cash.

Another benefit to Walmart customers comes in the form of the Jackson Hewitt tax consultants working at some participating locations. These consultants offer free tax filing assistance to customers to find eligible health care options that exist under the Affordable Health Care Act. These services help to complement the existing Walmart Healthcare Begins Here program, which provides basic health insurance guidance to customers. All of these new services go hand-in-hand with each other and provide additional revenue to Walmart, while making the entire tax refund service easier to get through for everyday consumers.

Chase Well Prepared to Successfully Enter the Mobile Wallet War

JPMorgan Chase is one of the most successful financial firms in the world. It should come as no surprise, then, to find out that this company is upping its game to compete in the mobile banking market. Last month, Chase’s CEO of consumer and community banking Gordon Smith informed investors that the mobile payment landscape was likely to become more confusing prior to becoming easier to understand. Smith did ease the sting of this statement, though, by saying, “But it will become simpler.” To make a long story short, this means that by the time things shake out in the mobile payment world, Chase Pay will do all that it can to be one of the easiest to use options that is still doing business. And the system has several features that will help it to stay in the game for a while and to successfully compete for a larger market share.

This announcement from Smith was meant to bring investors back to a view of the industry that closely resembles that of the earliest days of the mobile market wars. The sentiment then was: “One of these technologies will win out, but no one knows what it is.” This is a feeling that many remember from just a few years back when Google Wallet failed to live up to expectations. This service struggled to get merchant, customer and even banks to adopt it. Things reverberated more when the Isis Mobile Wallet, which changed branding to Softcard (in order to avoid any connection with the Islamic State terrorist group) pretty much died quickly. This death led to Google purchasing Softcard assets, and led to the popularity of the new Android Pay.

Apple Pay launched publicly in 2014, and started a whole new slew of mobile wallets, and eliminated the old though of only one company “winning” the mobile wallet war for supremacy. In fact, experts now believe that multiple third party providers will have successful mobile wallet products and that banks will now begin to launch their own, branded versions of this type of technology. In other words, it is no longer a battle where one winner takes all. The new theory has evolved into customers choosing a mobile wallet that has a lot in common with how they choose banks, cars or even computers. They will choose a mobile wallet that suits their needs or a brand that they have experience with. Wallet providers, therefore, will be ready to oblige consumers with different wallets with different features for people to choose from.

For the sake of argument, though, let’s say that the vision behind Chase’s offering is crystal clear. Smith said that Chase wouldn’t be investing as aggressively in its mobile wallet if it thought it was going to wind up as an “also ran” behind other mobile payment systems. No, Chase wants Chase Pay to be one of the top dogs.

But will Chase be able to pull this off? Well, the company has a brand name that many people are already aware of and comfortable with. This company is known for being a longstanding player in the financial world, so that will likely make many consumers feel safe in trusting their mobile payment needs to Chase Pay. Smith is also very experience in this field, and will help to lead Chase Pay into the trenches successfully. It also appears that Chase Pay will have plenty of features that consumers look for in a mobile wallet system. We will all have to wait a bit to see, but some experts believe that this mobile payment system does have what it takes to successfully stand as a mobile wallet victor when it’s all said and done.

A Seemingly Small Financial Emergency may be too much for Most Americans to Deal With

File this under bad news for the average American household: The majority of people in this country don’t have enough money saved up to deal with seemingly simple to pay for financial emergencies! Yes, most folks out there would have to seriously scramble if they had to suddenly pay for a car repair or medical bill that might cost anywhere from $500 to $1,000. This tidbit of information seems to indicate that most folks are living from one paycheck to the next, with very little financial wiggle room. An illness or car problem could prevent these people from having enough money to pay their monthly bills. A recent study found that only a little over 20 percent of people believe that they be able to deal with a financial emergency by cutting down on other expenditures.

An additional 15 percent of those surveyed said that they would have to get through a temporary financial setback by borrowing money from family members. Another 15 percent said that they would be forced to use their credit cards to get by. These statistics line up pretty well with findings from other studies done in recent years. The bottom line is that many Americans are in a financially difficult spot. Even though consumer confidence stats seem to show that consumers are feeling positive about the job situation in this country, the majority are still not putting money away regularly to deal with financial problems down the road.

A 2015 study conducted by the Federal Reserve used data that studied the financial health of U.S. households. It concluded that only about half of Americans regularly put money into a separate savings account for the future. Back in 2012, the repercussions of the Great Depression were still being felt by many people, and the savings rate in the country got all the way up to 11 percent. It fell again to 4.6 percent by the summer of the following year and hit 5.5 percent by the time winter rolled around. Before the 2008 financial recession most Americans seemed to feel financially stable. Back then, the savings rate reached a dismal rate of only 1.5 percent. This was during a time when people were using the equity in their homes like ATMs. This winded up getting a lot of people in trouble when their home values began to take a hit.

In the post-recession world, consumers have been trying to rebuild their financial futures. Millions of people lost jobs and found that access to loans and credit cards were difficult to come by. As the pressure started to die down a bit, these consumers have started to spend money more freely. According to the Federal Reserve, in 2014 just 47 percent of households in the country indicated that they were saving money for emergency expense. And if those folks were likely to experience a financial windfall, of say an extra thousand dollars, they would have been more likely to spend it than to save it.

Whether the next financial crash comes in just a few months or far in the future, Americans need to get educated and prepared to deal with financial problems. It doesn’t take a worldwide market crash to cause financial chaos in your home. For most Americans, simply dealing with life’s little financial emergencies may be enough to cause serious problems. Make saving money a habit. Pay into your savings before you do any spending, and you can make sure that you are at least financially prepared enough to deal with the most common types of money problems that always seem to arise at the worst possible times.

The Most Effective Methods to Repay Student Loan Debt Faster

One of the most difficult thing that millennials have to deal with, when it comes to their financial future, is the very real burden of paying of student loans. Being stuck with these loans often prevents young graduates from investing money or even getting their own homes. In a nutshell, student loans often feel like financial anchors that will never go away to the people who are stuck paying them off. In fact, the Federal Reserve Bank recently released a report that tallied up the average outstanding college loan balance at a whopping $24,301 – with 10 percent of borrowers stuck with debts that exceed $58,000.

Are you looking for tips on how to pay off your student loans faster? What follows are some tips that financial advisors often pass on to their clients to help them pay off their student loans, while maintaining a semblance of a normal life.

Consider Your Student Loan to be Like a Mortgage Loan

If you have a good job and are bringing in a steady income, you can treat that student loan debt the same way you would a big mortgage. Make efforts to make larger monthly payments. This helps to reduce the loan principal at a faster rate. If a student had $25K in student debt with 6.8 percent interest fees and a 10 year loan term, the payment each month would be about $288. However, if the borrower were to pay back $700 each month, the loan would be paid off completely in just a little more than three years. Paying down the principal on loans with larger payments allows borrowers to enjoy paying less interest on the loan.

Create a Plan to Eliminate Student Debt

Too many graduates just pick away at their student loan debts and complain about them to anyone who will listen. Instead of taking this approach, create a detailed plan to get rid of that debt that is hanging over your head. Break down the total amount that you owe, and come up with 3 and 5 year plans to help eliminate the student loan debt. You should break out your budget while you do this, so you can find other expenses that can be reduced or eliminated, so you can throw that money at your educational debt instead. Map out the next few years of student loan payments in detail, and then break down the large loan amount into smaller, more manageable monthly chunks to make the debt seem less overwhelming.

Set Up a Student Loan Repayment Account

It’s always possible for people to save a bit of extra money every month. Even if you can just get an extra $100 together after all the bills are paid, you can deposit that extra cash in an account that is completely dedicated to paying off your student loan debt. Establish a separate account that is ONLY for saving funds to pay off the educational debt. If you put the extra cash in your existing checking or savings account, it may be too tempting to spend the cash on other things.

Once you get your student loan debt paid off, use that extra money each month to invest and plan for the future. You worked hard to get your education and to pay off the loans that helped you to afford that education. When you are free from the educational loan debt, you’ll be able to breathe easier, and you’ll be able to get on the fast track to saving money for a better financial future.