With higher education comes expense. How is one to know the right loan to use? We all have different circumstances so what would be right for one would not necessarily be right for another. I wanted to explain a direct student loan option with you.
A direct student loan program is one of the Federal Student Aid programs offered by the Department of Education. This type of loan provides a student with a simple, inexpensive way to borrow money to pay for education after high school. The first step would be for one to apply for FAFSA. This can be done online.
If your school participated in the direct student loan program, you will need to complete a master promissory note to get a direct loan. The promissory not explains the loan terms and is the legally binding agreement that you will repay the department.
There are four types of repayment plans, standard, extended, graduated, and income contingent. You can choose the one that best suits your individual situation.
The financial consequences for a defaulted loan are so severe you will need to do all you can to avoid that scenario. Deferment and forbearance are options that can help you when repaying your loans. Remember, you can choose the repayment plan that best suites your financial situation, so choose the correct way for repayment.
Servicing for your direct student loan is made so easy for participants. It can be done online and allows you to make payments, get loan counseling, view you account balances and payment history, change your billing options, and enroll in electronic services and more.