Choose a Repayment Strategy

Student Loan Repayment Strategies: How to Choose

By Zina Kumok​

If you haven’t started paying off your student loans, it might seem like a pretty straightforward process. The bill comes in the mail, you pay it and wait for the next one. Eventually, you make the last payment and sail off into the sunset. While you could do that — and eventually you’d become debt-free — there are better ways to approach the process. Choosing the right loan repayment strategy can mean the difference between thousands of dollars saved over the lifetime of the loan. So what student loan repayment strategies are available to the average borrower, and how do you choose the right one? Here’s what you need to know.

Organize your loans

Organizing your student loans is the first step to devising a repayment strategy. You can find your federal student loans at the National Student Loan Data System.

All your student loans, federal and private, can be found on your credit report. You can look at your report for free at AnnualCreditReport.com. Once your loans are located, you may have to contact the lender directly to create an account for managing the loans online.

Next, create a spreadsheet and write down the lender’s name, the total balance, minimum monthly payment, interest rate, term length, and whether the loans are private or federal. This information will show which loans have the highest interest rates, allowing you to figure out which loans to focus on first.

It may be difficult to determine if a loan is federal or private because some private lenders also process federal loans. This distinction is important because federal loans have more repayment and forgiveness options than private loans. You may have to contact a lender directly to find out what kind of loan you have.

Review options for student loan repayment strategies

Once you’ve identified and located the type of loans you have, it’s time to look at your repayment options. Federal loans have income-based and extended alternatives, but the default is a 10-year plan. Private lenders usually have fewer options, but some may have extended or graduated payment plans.

You may be interested in applying for the Public Service Loan Forgiveness (PSLF) program, where graduates with federal loans can work at a qualifying non-profit or government job for 10 years in exchange for having their loan balance erased.

Some professions, such as doctors or nurses, have separate career-based forgiveness programs that pay for a certain amount if you work in a rural or low-income area. These programs usually require at least two to three years of work in an eligible position.

Set your goals

Your long-term goals will determine your loan payoff strategy. If you want to start your own business in the near future, for instance, you should avoid a loan forgiveness program that locks you into a certain position for multiple years. You may, on the other hand, consider refinancing your student loans to lower the monthly payment.

Look at your budget and decide how your student loans fit with the rest of your financial lifestyle. Borrowers having trouble making payments on federal loans should look into switching to a more affordable option, either by choosing an income-based repayment option or deferring the loans entirely.

Private lenders often don’t offer income-based repayment, but you can refinance these loans to a lower interest rate, lower monthly payment or both.

You can pay off your loans on time or ahead of schedule. Paying your loans off early saves you money on interest, and being debt-free can provide peace of mind. It also frees up money for other goals, like starting a nest egg for retirement or traveling around the world.

Student Loan Repayment Strategies

Zina Kumok

Zina Kumok is a freelance writer specializing in personal finance. A former reporter, she has covered murder trials, the Final Four and everything in between. Her advice has been featured in Lifehacker, the Washington Post and Time. Read about how she paid off $28,000 worth of student loans in three years at Conscious Coins.

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Climb’s Comprehensive Access Solution can offer a strategic balance of increased enrollments and upfront cashflows compared to traditional lenders. While no financing solution guarantees 100% collection, our data-driven approach maximizes both upfront cash and long-term repayment rates.

Typical Partner Results:

  • 15-30% of students qualify for Climb Loans with upfront tuition delivered to the school shortly after course start
  • 45-60% of students qualify for 0% APR* payment plans
  • Enrollment increases of 20%+ reported by partner schools**

**Results vary by school and student demographics. This represents performance reported by individual school partners and should not be considered a guarantee of your specific outcomes.

The bottom line: CAS is designed to maximize your net tuition recovery while eliminating the administrative headaches of student financing.

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Pro Tip: Schools that require student deposits and set up automatic payments during enrollment see significantly better repayment performance across all financing options. These simple steps can meaningfully improve your outcomes.

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We use a comprehensive, AI-driven assessment that goes beyond traditional FICO scores to better serve career training students:

  • Climb Credit Score: Over 150 data points specifically designed for vocational students
  • Debt-to-Income Ratio: Reliable predictor of payment performance
  • FICO Score: Used primarily for interest rate assignment

Key advantages of our approach:

  • Soft credit pull until loan funding (no credit impact during application)
  • The majority of students receive instant decisions
  • Students can apply with co-borrowers directly in the application
  • More accurate placement into appropriate financing products

We use a comprehensive, AI-driven assessment that goes beyond traditional FICO scores to better serve career training students:

  • Climb Credit Score: Over 150 data points specifically designed for vocational students
  • Debt-to-Income Ratio: Reliable predictor of payment performance
  • FICO Score: Used primarily for interest rate assignment

Key advantages of our approach:

  • Soft credit pull until loan funding (no credit impact during application)
  • The majority of students receive instant decisions
  • Students can apply with co-borrowers directly in the application
  • More accurate placement into appropriate financing products

Students are placed into funding brackets (Elite, Standard, Enhanced) based on our AI assessment. Higher-credit students generate higher upfront payments to your school, while students with limited credit are seamlessly directed to our 0% Payment Plan.

These brackets are established using data from over $1 billion in career training loan originations and may be adjusted periodically based on updated repayment trends.

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Elite Access not available for Computer Science programs. Upfront percentages vary by industry and loan terms.

Once Climb disburses upfront funding for a student loan, that student is considered fully paid by your school. You will not receive any additional payments for that student—the single upfront payment is complete and final.

From that point forward, the student’s repayment obligation exists exclusively between Climb and the student. Your school has zero liability if the student defaults, and you keep the full upfront payment regardless of the student’s future payment performance.

They’re automatically offered our 0% Interest Payment Plan, ensuring no student is turned away while maintaining steady monthly cash flow for your school.

Higher-credit students generate larger upfront payments (75-100% of tuition), while students with limited credit use our 0% APR* Payment Plan for consistent monthly revenue. Both options are risk-free for your school

Absolutely. Climb complements existing payment options like scholarships, employer-sponsored programs, and internal financing.

Absolutely. Climb complements existing payment options like scholarships, employer-sponsored programs, and internal financing.

Typically, within 5-10 business days after your partnership agreement is signed.

Comprehensive onboarding webinar, continuous partner support via AI-assisted chat and live email—and real-time borrower assistance with our live-chat-available student success team.

No. Climb fully manages the administrative responsibilities—your team simply monitors your school’s performance via our intuitive School Portal.

Your school is fully protected either way. For Climb Loans, you keep the entire upfront payment with zero liability. For Payment Plans, you only receive what students actually pay, with no risk to your school.