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Private loans

How long does it take to pay off private student loans? 

Updated 01/12/2021

Taking out student loans can help finance your education, but it comes with the responsibility of repayment once your time in school is finished.


While some lenders may offer a small grace period to prepare yourself after graduation, it’s a smart idea to plan for repayment so you can get started on paying off your loan as soon as you can.


So, how long does it take to pay off student loans?


What determines the length of repayment?


Private lenders will offer repayment terms that can range from 5 to 25 years.


Repayment Options


Depending on your specific plan, you may have a few options for repayment over varying timeframes.


Borrowers will be given or select a repayment term during the application process that they will need to adhere to throughout repayment. Most lenders do allow pre-payment without any penalty.


The Average Time It Takes to Pay Off Student Loans


As EducationData.org reports, the average borrower takes around 20 years to pay off their debt.


Private borrowers may be able to significantly reduce the time it takes to repay their loans, depending on repayment options offered by their lender. Most private borrowers can expect to pay off their loans in anywhere from 5 to 20 years.


3 Realistic Ways to Pay Off Your Loans Early


If you’re looking to get ahead, it’s possible to cut down the amount of time it takes to repay your student loans with a few simple strategies.


Pay off private loan interest in school


Students who take out private loans are subject to interest that accrues while they’re in school, during their grace period, and if they take deferments or forbearance. As such, private borrowers can get ahead by making monthly interest payments to keep their interest at a minimum – and pay down their balance faster later.


Make extra payments


The simplest way to pay down your student loans fast is to make extra payments, or to pay more than the minimum amount.

That said, some student loan services may apply any excess to the next month’s payment, rather than paying down your principal. So, if you go this route, be sure to instruct your servicer to apply overpayments to your current balance.


Refinance your loan


If you have good credit and a steady source of income, you might be able to refinance your loan at a lower interest rate. In addition, if you have multiple loans, you can consolidate (or bundle) them into one loan at a single interest rate, with an opportunity to save money.


How long does it take to pay off student loans?


If you’re thinking about how long it will take to pay off your student loans, the good news is that you may have a lot of options.


With some smart money management tactics and an extra payment here or there, you can work off your balance in no time!