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How transferring schools during college can impact student loan debt

College student Loan Debt
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College transfers may have been down 5% across the board in 2020, but new info from Student Loan Hero shows that a handful of states saw a big increase in transfers.

Schools in Utah saw a 15% increase in transfers, the highest rate in the country. Schools in New Hampshire and Arizona followed close behind.

Historically Black colleges also experienced a spike in transfer students, and experts believe that the nationwide protests against racial injustice may have played a role.

"Talking about race, making it more a part of that conversation about education has only helped to make certain students aware all over the country that they may have more college options than maybe they previously considered," said Andrew Pentis, a senior writer with Student Loan Hero.

Transferring schools can also help college students reduce loan debt, particularly if the new school has cheaper tuition or if the student can land a scholarship.

Pentis says it's important to know that students can return a federal loan if they transfer before the four-month mark.

He also encourages students to make in-school payments on their loans, even if they're not required to pay them back until after graduation.

"It's really important to make in-school payments on your loans. And when I say that, I think a lot of families get scared — you know, it's not something we can afford," Pentis said. "But really, put it in the context of every little bit helps. If you skip a dinner out or a new piece of clothing every month — say $25, $50 — and you just throw that money at your student loans, instead of those not-so necessary expenses, you can make sure that the interest on your loans won't accrue and capitalize so that when you graduate, hopefully, you're staring at a similar balance to what you originally borrowed and not something that's really ballooned and gotten out of control."

Pentis added that making in-school payments can lower monthly payments once students graduate.