Re: Will I get a discount for paying all my debt at once? If this is possible - can one estimate?
1. Is this even possible? That is, to get a discount if I pay all the sum (rather, close to it) at once?
- I own 23,500 dollars. I would like to pay at once, but I don't have all the sum. Rather, I have close to it. All my loans are government loans. Will they flex?
No. And if they did, you would have a black mark on your report of "settled for less than full amount". You don't want that.
When you pay in full early, your savings comes from the interest you don't have to pay. Say, for example you took ten years to pay it off. At three percent, you would pay a total of 3,700 in interest. So, paying now saves you several thousand dollars. Minus the tax deduction from sl interest, of course.
If you have most of that amount, take a hard look... Pay off any other debt with equal or higher interest, and then start looking at the student loans. Pay in full the highest interest ones first, and make principal payments to the remaining. Even if you can't pay them completely off, getting it down to a manageable amount will reduce your overall interest paid over time.
And don't forget to set aside savings.
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