Higher Education Loans Board (HELB) Loan Repayment Tips

 

Loan Repayment Tips – Higher Education Loans Board (HELB)

HELB LOAN repayment tips 2016
So you have graduated with a degree and a loan of about KShs. 200,000. Servicing your student loan is not easy because in most cases the total amount owed is in hundreds of thousands of Kenya Shillings. It is even more challenging when one is unemployed and there is a default in giving Caesar what is duly his.

In order for you to service without tears, kindly adhere to the following HELB repayment tips.

Bookmark the online HELB loan repayment status page. This page will Frequently check HELB loan balance/ status:help you monitor how much you have paid and how much is still pending.  You should visit the page at least once a month. When you pay via M-Pesa or Airtel, HELB will take just a couple of days to make your payment reflect on your portal. Using the portal, you can download your HELB loan repayment statement. You can access the page by signing into your account then you click on “Pay Loan” under “Loan Reports” select the category and the click on “Search.”

Make tri-monthly repayments. This is a trick that is normally used in the ordinary loans. For example, if you owe KSHs. 200,000 and you wish to complete the payment in 5 years (60 months) then you will have to pay atleast KShs. 3,333.33 per month. You can shorten the five-year period by working towards making payments of KShs. 10,000 per month. This will shorten the period three times from 60 months to only 20 months (1 year 8 months). So you can develop a repayment schedule of KShs. 1,000 per month and then you work towards increasing your repayment amount so as to shorten the repayment period.

Does paying in lump sum prevent a penalty?
Let’s say you have been paying KShs. 1000 or KShs. 1500 per month and then you opt to pay a lump sum amount of KShs. 30,000 in a given month. In the following month, you fail to make your routine payment of KShs. 1000 by not pay any penny at all. What will happen? Will you be penalized with KShs. 5000? Well, the answer is yes. The lump sum payment will not deter the penalty if you default to make monthly payments.

Purpose to repay the loan within five years: There is absolutely no reason why you should be servicing a student loan 5 years after your graduation. To avoid a situation whereby you will still be thinking of the loan 5 years down the line, it is imperative that you craft an effective schedule and make some payments in lump sums once in a while.

Explore other remittance channels: As you now, you can pay HELB using different methods like EFT, Cash deposits, mobile funds transfer etc. if you have been paying using EFT, you can use mobile funds transfer to repay the loan. For instance, you could be having extra money in your phone that you are not really sure of what to do with it. Instead of rushing to the market to buy an item that you don’t really require at that point, you can send that money to HELB using your phone.

Unemployment is no excuse: Most graduates who are unemployed waste all their grace period hunting for jobs. Just after the grace period is over, they switch on to the next gear of defaulting. With the penalty of KShs. 5,000 a month, such graduates will individually owe in excess of a quarter million in less than 4 years in penalties alone.

Defaulting makes the loan expensive: The penalty of KShs. 5,000 a month plus the interest that is charged on the outstanding amount makes the loan a heavy burden to bear for a defaulter. Some people default for a period of one year only to be met with an extra amount of about KShs. 60,000 in penalties.