What repayment plan to choose?
Most companies offer at least two repayment plans – standard and graduate. They may be called differently by different lenders, but the general idea is the same. The standard plan is the most simple – your monthly payments are the same for the life of your loan. With this plan you usually pay the least amount of interest. Graduate plan supposes that at first your monthly payment is lower; it can be low for 12 or 24 month. But your later payments are higher. This plan is perfect for graduates who are not sure of finding well paid work straight after graduation or if you expect other major expenses, like having a baby. By choosing a graduate plan you will pay more interest that on standard repayment plan, but the difference is usually not all that much. There also might be other plans that allow you to make lower monthly payments, but you will have to pay off your loan longer. These plans are usually the most costly, because you end up paying much more interest.
