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8 Student Loan Mistakes You Don't Know You're Making

Paying off your student loans is hard work. The last thing you want to do is make it harder for yourself by leaving money on the table or paying unnecessary fees.

Of course, most borrowers don’t pay more than they should on purpose. So how can you make sure you’re not getting in your own way?

We put together a list of some of the most common student loan mistakes borrowers make. After all, you can’t avoid a mistake if you don’t know what it is.

1. Paying late fees

You know it’s not a good idea to pay your student loan bill late. You’ll rack up late fees, put less of your money to principal, and risk going into default. But did you know that many loan servicers will work with you if you’re having trouble making your payments?

You may be able to avoid a late fee simply by reaching out to your lender.

Repeat after me: If I can’t pay my student loan bill, I will call my loan servicer and ask what my options are.

2. Missing out on cost savings you’d get through refinancing

The average borrower who refinances their student loans with a private lender saves over $250 monthly and $16,183 over the life of the loan. With those numbers, we wouldn’t blame you if you stopped reading and headed over to refinance your loans right now.

3. Paying only the minimum

Your student loans are accruing interest every day.

Every. Single. Day.

Imagining those dollars piling up over a 20- or 25-year loan term could make you dizzy. Fortunately, you don’t have to pay all that interest—unless you insist on paying only the minimum amount every month.

If you pay more than the minimum and ask your loan servicer to apply the overage to your principal, you’ll pay less interest over the life of your loan. You don’t have to do it every time, but funneling any extra cash toward your payments will reduce the total cost of your loans over time. 

4. Deferring your loans unnecessarily

When you’re feeling a little strapped for cash, deferring your loans can sound like a great option. Extra money in my pocket right now? Sign me up!

Unfortunately, when you defer your loans, your loan servicer continues to add interest. Take a minute to consider whether Future You is going to look back and wish you’d found a way to make those payments instead of allowing months—or years—of interest to accrue unfettered.

Instead, finding a way to lower your payments might allow you to continue making progress on your loans without deferring them.

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5. Treating loans like free money

When you deposit that big loan check in your bank account, you may start seeing visions of yourself lying on a white sand beach during an expensive spring break vacation. You wouldn’t be alone.

But student loans aren’t free money. They have to be paid back. That spring break vacation that costs you $1500 this year could end up costing you thousands in interest.

Living on student loans is the perfect time to practice using a budget and putting money toward savings every month. 

6. Skipping opportunities to save

Most loan servicers offer discounts for things like having your payment automatically debited from your bank account. A quarter of a percentage difference in your interest rate might not sound like much, but when you’re calculating it over decades, that money adds up.

Ask your loan servicer if there are any additional options for reducing your interest rate. Make sure you’re getting the best deal possible. If you're not, consider refinancing. 

7. Paying your student loans with a credit card

If you’re struggling to make your monthly payments, putting that bill on your credit card may seem like a no brainer.

Unfortunately, you could end up paying more in the long run. Credit cards often have interest rates higher than student loans—sometimes more than 15%. So while you may have handled your student loan payment for the moment, you’re now paying double the interest on that payment amount.

Instead of paying with a credit card, find out if there are other ways to reduce your payments.

8. Treating student loan debt like it’s inevitable 

When you look at that student loan balance, you may be tempted to throw your hands up in the air and give in, accepting that you’ll be paying student loans for the rest of your life.

But it doesn't have to be that way. There are many ways to reduce your payments, lower your debt load, and pay off your debts—and plenty of other borrowers who are figuring it out alongside you. YOU CAN DO THIS.

If you’ve made—or are making—any of these mistakes, don’t despair. We can help you get back on track. Refinancing your student loans could help you save hundreds every month.  

Additional Nitro Recommended Student Loan Lenders

Lender Rates (APR) Loan Types Terms Eligible Degrees Eligible Loans  

Sallie Mae

3.37% - 13.72%1 Variable & Fixed
10 - 15 years

Undergrad Students Learn More

View Disclosure

Ascent

3.04% - 14.75%1 Variable & Fixed
5 - 15 years

4

Undergrad & Graduate Students Learn More

View Disclosure

Earnest

2.70% - 12.78%1 Variable & Fixed
5 - 15 years

3

Undergrad & Graduate Student & Parent Learn More

View Disclosure

SoFi

2.99% - 13.60%1 Variable & Fixed
5 - 15 years

Undergrad & Graduate Student & Parent Learn More

View Disclosure

FundingU

6.99% - 12.99%1 Variable & Fixed
10 years

Undergraduate No-Cosigner Student Loan Learn More

View Disclosure

MPowerFinancing

7.52% - 14.98%1 Fixed
10 year only

Undergrad & Graduate Student Learn More

View Disclosure

Rates (APR) 3.37% - 13.72%1
Loan Types Variable & Fixed
Terms 10 - 15 years

Eligible Degrees Undergrad
Eligible Degrees Students
Rates (APR) 3.04% - 14.75%1
Loan Types Variable & Fixed
Terms 5 - 15 years

4

Eligible Degrees Undergrad & Graduate
Eligible Degrees Students
Rates (APR) 2.70% - 12.78%1
Loan Types Variable & Fixed
Terms 5 - 15 years

3

Eligible Degrees Undergrad & Graduate
Eligible Degrees Student & Parent
Rates (APR) 2.99% - 13.60%1
Loan Types Variable & Fixed
Terms 5 - 15 years

Eligible Degrees Undergrad & Graduate
Eligible Degrees Student & Parent
Rates (APR) 6.99% - 12.99%1
Loan Types Variable & Fixed
Terms 10 years

Eligible Degrees Undergraduate
Eligible Degrees No-Cosigner Student Loan
Rates (APR) 7.52% - 14.98%1
Loan Types Fixed
Terms 10 year only

Eligible Degrees Undergrad & Graduate
Eligible Degrees Student

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