Thursday, February 28, 2008

Direct Student Loan 2

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.

So, as you can see a direct student loan really offers many choices for the student. Allow it to help you in your financial need to complete your higher education

Understanding Student Loan Interest Rates

One thing students do not have to worry about with their student loans is the student loan interest rates, at least on federal and state loans. Student loan interest rates on federal and state loans are usually very competitive and probably lower than the student loan interest rates they would receive on private loans. This is not to say however that student loan interest rates are fixed, in fact they do fluctuate with the current economy, however the student loan interest rates rarely fluctuate so much that it makes a significant difference in the overall amount of money due after graduation.

Students should however become accustomed to checking their student loan interest rates just to make sure that nothing starts going amiss. Fortunately checking student loan rates is fairly simple especially if you have an Internet connection. And if you’re reading this, well, you get it. More than likely most all students’ government student loans are handled by one company that issues the loans, the lender. In most all cases the company has an up to date website where students can go to check their loan information including, but not limited to, their current interest rates.

Although there really isn’t anything you can do about student loan interest rates, it is still a good idea to keep ahead of this information not only to better prepare yourself for your financial future, but so that you can more accurately estimate what your repayment costs will be after graduating by adding the student loan interest rates into the total money due.

Once you start talking about private loans, however, student loan interest rates can become a whole other ballgame. Because there is no real governing body over student loan interest rates on loans issued through private banks and credit unions, these interest rates can fluctuate wildly and be subject to unfavorable terms and conditions under certain circumstances. Therefore if you do plan on getting private student loans you’ll definitely want to look at the student loan interest rates information associated with that loan, as well as READ ALL FINE PRINT before agreeing to any terms or signing anything.

Student loan interest rates are nothing to be scared of. In fact they are just like any other interest rate out there, and learning how to better manage your interest rate while you’re still in school is a great learning experience. By managing your student loans responsibly, you not only are helping to secure your financial future you’re also learning a valuable skill. Start educated, stay informed and be positive. Stop by our student loans.org to learn college loan basics and take a look at the current popular student loan lenders.

Financial Aid Programs

You are planning to go to college. How are you going to fund this venture? I am hoping to help you out with some information about financial aid programs. For most people this is the first place to start.

Financial aid refers to monies that are specifically borrowed for a higher education. While there are many types of financial aid, the most popular are scholarships, grants, and loans. You should research them all to be fully educated in financial aid programs.

Financial aid programs come from many different sources, such as federal government, state, and various employers. Many private sources also provide financial aid. These sources are agencies, associations and organizations like, civic, religious, philanthropic groups and associations related to one’s field of interest. To increase your chances of obtaining financial aid you must plan ahead, apply early and read directions carefully.

Let us start with a scholarship. A scholarship is a type of gift aid that grants funds for grades, athletics, a unique skill, a special talent, financial needs or even a specific career interest. Typically, you would not pay back a scholarship, most have requirements and obligations that must be adhered to so the scholarship may continue.

Next, there is a Grant. A grant is a type of gift aid that does not need to be paid back. This is usually based on financial need and is generally provided by the government or the college a student attends.

Of course, there is always a loan. A loan is a type of self-help aid that lets individuals’ borrower money from many different places, such as government, banks, or other lending institutions. A loan will always need to be paid back with interest.

It is important to remember that financial aid programs have requirements that must be fulfilled as a condition to receiving the financial aid. If the requirements cannot be met, financial aid received may convert to a loan. So, do your homework and pay attention to what you learn. There are many different financial aid programs to choose from. Just do the research.

Government Student Loans

Borrowers who find their government student loan in default have the option of rehabilitating the loan. Through the federal loan rehabilitation program, the borrower and government student loan holder agree to a payment plan that repairs the loan’s status. This plan is spread out across 10 months and includes nine voluntary (and on time) payments.

Loan rehabilitation generally includes a signed agreement between the borrower and the lender specifying the terms of the loan’s repair. Money acquired from the payments is subtracted from the maximum repayment term of the loan.

The overall objective of rehabilitating a government loan is to remove it from default status. Upon successful completion of the program, the national credit bureaus are notified of the change in status. Delinquencies reported prior to the default remain on the borrower’s credit report. The borrower also regains Title IV Loan privileges, including the ability to use any remaining deferment or forbearance time.

Collection costs incurred during the rehabilitation and outstanding interest at the time the loan is rehabilitated is added to the loan’s current outstanding principal balance. In return, this increases the total amount the borrower owes.

Not all rehabilitation programs are the same. Keep in mind the terms of the program rely heavily on the type of government student loan that is in default. Specific information regarding Perkins loans can be obtained directly through the school’s financial aid administrator. For FFEL loans that go through a rehabilitation program, a participating lender must purchase assume and provide loan servicing for the debt.

Once a loan has made it through the rehabilitation process, the borrower is required to continue making on time payments to the lender. Depending on the repayment plan, these payments may be more than the payments due during rehabilitation.

To learn more about the government student loan program and how to rehabilitate a loan, visit the Department of Education website at www.ed.gov

Private School Loans

Attending a private college after high school can cost approximately four times more than it costs to enroll at a public four-year institution. Students, however, increasingly opt for a private education as professional careers become more competitive. Paying for private school is by no means easy, but it is quite possible.

Private school loans can be obtained from both the U.S. Department of Education and a private lender. The government backs both subsidized and unsubsidized loans for students. If you are able to show financial need, you may qualify for a subsidized loan – that is a loan where interest is not charged during deferments and grace periods. Government loans are ideal because they feature low interest rates and are virtually hassle-free. The problem with government loans is they barely pay out enough for students attending public institutions to keep their bills paid. A lot of times, a government loan isn’t enough to address a student’s living expenses.

Enter the private lender. Private school loans can also be taken out through a private agency. Private loans are a little trickier than the government student loan. Lenders don’t care about a person’s “financial need” but credit history and ability to repay are very important. Therefore, in order to be considered for a private loan, the potential borrower must have a solid credit history or a co-signer who does. Private lenders also offer different loan packages and interest rates. Borrowers looking at private student loans through an agency outside the Department of Education should gather information on numerous lenders and compare them to find the best deal.

One way or another, paying for a private college education is doable, it can just take a little more work on the financial end of things. Ideally, students will exhaust their federal loan and grant options before turning to a private lender for financial assistance.

Student Loan Calculator

A student loan calculator will help you understand your loan repayments in relation to your possible starting salary. One would just enter the amount(s) you have borrowed or expect to borrow for college, graduate, or professional school in a form. Then, enter the amount you expect to earn when you graduate. Submit the form electronically to get an analysis of whether the amount you have borrowed or expect to borrow is manageable or potentially burdensome.

Were can one find these calculators? These calculators are everywhere on the internet. Just type in Student Loan Calculator and you will find many different ones to choose. They all seem to be very similar in format and information requested. But keep in mind it is only an estimate.

Typically, they are set to figure a loan at a 120-month payback period. Usually there is a preset minimum payment of $50. Keep in mind all of these calculators are only a projected figure. You cannot hold your payment to whatever the calculator states they are only estimators.

Besides student loan calculator, you can find many other kinds of calculators. There is graduation-planning calculator. This calculator will help you budget your time to achieve graduation in a specified amount of time. There is a net earning calculator. This calculator will help you decide whether it is in your best interest to borrow, or borrow more, and finish sooner or work and borrow less or not at all.

There is also an in school budget worksheet to help you stay within your budget during school. Once you have completed your schooling, there is an out of school budget worksheet that will help keep you on track once you are out in the workforce. We could all us this worksheet.

Student Loans for College

There are many student loans for college to choose from so how do you know which one to go with? You need to educate yourself on the types of student loans for college that are available to you and what exactly you can use them for. There are some student loans for college that will only allow you to use the funds for college expenses only and then there are some student loans for college that will allow you to use the money as you see fit like to pay for living expenses.

College is very expensive so many find that it is difficult to make ends meet and that is why they need student loans for college. You can get private student loans for college from various lenders. You can also check with the financial aid department at your college of choice to see what student loans that they offer.

There are many federal student loans for college that you can apply for right through your school or even on the Internet from the privacy of your own home. No matter which student loans for college that you look into, you will need to be sure that you fill out the forms completely. There are PLUS student loans for college that parents can apply for to help pay for their dependant child’s education.

You can also apply for student loans for college that are known as Stafford loans. These are federal student aid loans which are known as some of the best student loans for college. No matter what student loans for college you choose to go with you want to be sure that you have the ability to combine these loans or consolidate the student loans for college. No matter if you are looking for Undergraduate Loans or Graduate student loans for college, you want to get what meets your needs and is the most flexible for your wallet.

More and more families are finding that student loans for college are a necessity. Be sure to look into what options you have for student loans for college so you can make an educated decision. Choosing student loans for college is not something you want to go lightly into as you can suffer in the long run with high interest rates on your student loans.

Consolidating Federal Student Loans

Consolidating Federal Student Loans

What happens after you consolidate federal student loans and then default on your payments? Unfortunately, some student borrowers find that even after they’ve combined their student loan debt, they can’t make the payments. In fact, it is common for borrowers to consolidate federal student loans in an effort to keep their loan current. If this fails, however, the borrower is faced with unpleasant results.

To begin, a loan in default may be assigned to a collection agency. This would take place after several efforts of the lender to contact the borrower about bringing the loan current. If you find yourself heading to or in default, the best thing to do is contact your lender before you education loan is sent to the collection agency.

Additionally, the loan’s default may be reported to the national credit bureaus. This will drive the borrower’s credit score down. Even worse, the borrower will lose their right to request a deferment and they will no longer be eligible for new federal student aid. To protect yourself from losing these privileges, make a considerable effort to keep your federal student loan current, by contacting your lender.

If you consolidate federal student loans and are still having problems making your monthly payment, inquire about a deferment (before you are late on your payment) and other options available to you during times of economic hardship.

In order to resolve a defaulted student loan, the borrower must either make repayment arrangements or rehabilitate the loan (which in turn restores Title IV benefits to the borrower).

A borrower might also look into having their student loan cancelled under federal regulations. As a general rule of thumb, loan cancellation requires significant proof of hardship, death, or permanent disability. Specific information on federal student loan cancellation can be found at www.ed.gov

Lastly, if a borrower feels that he or she has the right to argue a defaulted federal loan, a dispute can be filed. An official dispute requires supporting documentation and must be done, initially, through the lender.

Fast Student Loans

Need a fast student loan? A fast student loan would be an unsecured private consumer loan for your education financing needs. Loans are available for Kindergarten through 12th grade schools. A fast student loan can also help pay for expenses related to school but that may not be covered by other forms of financial aid. You are busy and deadlines are approaching. You can apply usually online or over the phone in as little as 15 minutes, depending on your financial institution.

Undergraduates may choose to defer repayment of principal and interest for six months after graduation or ceasing to be enrolled at least half time. Immediate repayment and interest only repayment options are also available. Graduate repayment is automatically deferred. Continuing education borrowers begin repayment as earlier as 180 days after the student graduates or earns a certificate; or 180 days after the student ceases to be enrolled; or two years after the date of the loan disbursement. A fast student loan for Kindergarten through 12th grade school would have an immediate repayment plan.

Undergraduate and graduate borrowers may borrow annually up to the lesser of the cost of attendance or $30,000 ($40,000 for certain schools where it has been determined that the annual cost of attendance exceeds $30,000) and up to the aggregate amount of $130,000. Borrowers in continuing education and K-12 loan programs may borrow annually up to $30,000 and up to the aggregate amount of $130,000.

Do your research. Check all your options out. Make sure you have exhausted all your Federal Assisted loans and any other loans available to you before you go for a fast student loan. The price may be high, but if you need the funds to continue your education, you at least have options.

Private Student Loans

When Federal Student Loans, such as the Stafford or PLUS loan, does not quite cover the cost of education, a private student loan can help. You can use it to help cover education related expenses such as tutors, computers and software, books, travel and that last minute tuition hike. With competitive interest rates and no application or out of pocket fees, many private student loan companies can help supplement your financial aid package.

Generally, you can borrow up to $40,000 a year. You can have the funds sent straight to your with 5 business days of completing an application and you can defer all payments until after you graduate.

To qualify most applicants would need a co-signer. You can improve your chances of receiving the private student loan for money you need for college and reduce your costs of borrowing with lower rates and fees that may apply. Of Course you can apply without a qualified co-signer, you will just need to meet all of the following credit requirements.

Usually requirements needed to apply for a private student loan are satisfactory employment history for at least the last two years, proof of current positive income, at least 21 months of credit experience and satisfactory credit history. You must be a US citizen or permanent resident and reside in the US for the previous two years.

In addition you must be an undergraduate student enrolled in a degree or certificate program, enrolled at least half-time as defined by your school, attending an approved school and finally able to provide proof of enrollment.

Not so difficult. In most cases, one would need to get a private student loan to further fund there higher education. As long as you have gotten all federal aid, grants, and scholarships, this would be your next step.

Consolidate Private Student Loans

To consolidate private student loans, or not to consolidate is a common question among borrowers trying to simplify their life. While the initial reaction by most borrowers is to roll all their loans into a single loan for ease of repayment, it is not always the right answer. The following are some facts about student loan consolidation to help your decide if a consolidation is best for you.



How does loan consolidation work?

The action of consolidating student loans pays off the original debts and creates a single debt that equals the balances combined. In short you get a larger loan with a fixed or variable interest rate depending on the program.

What are the cons to consolidation?
By consolidating you increase the length of payments on your loan, this means you accrue more interest in the long run and are subject to larger charges.

If you consolidate private student loans, how does that drop the payment?
Typically, by consolidating your student loans your monthly payments can drop as much as 50 percent. This is because
What will my interest rate be?

Your consolidated interest rate will depend on the private lender you choose and your credit rating. If you find the interest rates available to you are a little steep, you may consider asking a parent or relative to cosign. Specific information on interest rate plans vary with each lenders
What happens when I consolidate private student loans during my grace period?
If you consolidate during your grace period, you will lose any remaining grace period time you have. So if you do decide to combine your loans, do it towards the end of your grace period.
Where can I learn more about how to consolidate private student loans?
There are numerous online resources to help you consolidate your student loans. You may also consider contacting your current lender(s) to find out what types of programs are available to you.

Student Financial Aid

After i have publish about Student financial aid in a previous of my post here. Ill give it more at here. Something that i have publish in previous post. Student loans are almost inevitable these days. Colleges and Universities charge so much between room and board, students also have to worry about books, supplies, food, gas, and even class or lab fees. A college can cost as much as $40,000 per student per year. Parents are not always able to help with the cost of this.

Applying for federal student financial aid for a student loan is simple, as long as you know how to begin your process. Obtaining money and a student loan for a college education is not as complicated as people think. The financial aid process is different for each student, but there are factors that apply to almost everyone who applies.

Everyone should apply for financial aid and a student loan, even if they think they will not qualify. There are a number of factors involved in the eligibility process and there is always a possibility for a person to qualify.

The application for Federal Student Financial Aid (FAFSA) is free. It determines an applicant’s eligibility for student aid programs and many private grant and scholarship programs.

There are different programs for student loans. The two categories available for a student loan are government loans and a private loan.

A government student loan, also known as a Stafford Loan, should be what an applicant applies for first. Parents can consider a government student loan. This would be a PLUS loan and they are specifically for the parent. From time to time, a private student loan can be competitive with a government student loan program. Check the internet carefully to explore your options.

A Federal Unsubsidized Loan is a student loan based on no need. Every student who meets the eligibility requirements could meet the criteria for a Federal Direct Unsubsidized Loan. There is no need for a co-signer to apply for a Federal Direct Unsubsidized loan.

A Federal Subsidized Loan is a student loan made directly to the student. A person can apply for this financing by filling out and submitting a Free Application for Federal Student Financial Aid (FAFSA). Certain criteria must be met by the federal government.

As you can see, a student loan is easily accessible. The internet and the government both make the process simple and streamlined for your convenience.

Apply for a federal student loan online using the Department of Education’s FAFSA on the web. It is free, fast, easy and accurate. Education beyond high school can give you choices that may not otherwise be possible. It can open doors that otherwise may not be there, such as better paying positions, and the opportunity to do the things you enjoy most. Find out what you need to prepare.

Low Interest Student Loans

Are you an undergraduate student looking for a low interest student loan? If you do not have the credit or collateral to take out a loan, you can try the Federal Parent PLUS Loan. It has a fixed low interest rate.

It is possible to find a low interest student loan, but you do have to meet certain criteria. Most college students would not be able to meet the criterion, but the more you meet the lower rate you will be able to fine.

Another low interest student loan is the Federal Perkins Loan. This is a government-funded loan for those who are in financial hardship. The Federal Perkins loan charges a 5% interest rate. It is fixed at this so it will not adjust.

With the right credit history and the right terms, you can usually find just the loan you need. Having a good credit history is the best way to get a low interest loan. If you have late payments, too much outstanding debt, or too many inquiries into your credit history, this will all affect your rating. If you know you will be looking for a loan in the future, start now to repair your credit rating. Six months of stellar history can work wonders on a bad credit score.

Typically the longer the term for borrowing money, the higher the interest rate. To get a low interest rate loan, squeeze the terms into the smallest possible number. Cutting the term from a 30 year fixed rate to a 15 year fixed rate could save you as much as a full percent in the interest rate. The payment may seem a little higher, but the amount you actually make up in interest will be significant. The savings could actually reach into the thousands.

There are two types of loans, secured loans and unsecured loans. Secured loans require you to offer the lender any of your assets such as your home as collateral. This collateral serves as security against defaults in payments by the borrower. If you do not pay back the money borrowed, the lenders have the power and authority to take the collateral to recover their payments.

An unsecured loan does not require collateral. When no collateral is required, the lenders have more risk. To compensate the increased risk in case of default, lenders charge a higher rate of interest as opposed to a secured loan the risk is lower therefore the rate is lower.

Finding a low interest loan is still possible, especially when the interest rates seem to be dropping as they are. It does take some pre-planning and patience and some personal investment, but the benefits far outweigh the costs. Low interest rate loans are available in most types of loans such as secured/unsecured home loans, student loans, auto loans and personal loans.

Therefore, do your homework and get the best possible low interest rate loan that will work for your personal needs.

Financial Aid and Tax Benefits

In today’s economy, the cost of college is very high on the list of expenses. How does one determine the cost of a year of tuition? Typically, the school’s tuition and fees, room and board, meals, books and supplies, personal expenses and transportation expenses determine it.

Put together, this is the total cost to attend any given college or university for one academic year. Some students may have additional expenses such as medical care or costs arising from disabilities.

While the cost of college does increase each year, this should not scare you or your parents away from your educational goals. Financial aid is available to almost every student and his or her families regardless of the type of school the student is interested in attending.

Most students are eligible for some type of financial aid. For example, Minnesota students and families received almost $1.9 billion in financial aid during the 2005-2006 academic years. Where does this money come from? The money comes from the state of Minnesota and the federal government, colleges, and private sources. So, the funds are out there in every state to help with financial aid.

It is also important to remember, there could be huge tax benefits and deductions that make what families do have to pay more manageable.

The federal government does offer several tax benefits for pursuing a college education including tax credits, tax deductions, and exclusions from gross income. For Example:

Hope Tax Credit: The ability to claim a federal individual income tax credit of up to $1,650 for qualified tuition and related expenses for each eligible student.

  • Lifetime Learning Tax Credit: Claiming a federal individual income tax credit of 20 percent of the first $10,000 of qualified and related expenses you pay for your family.
  • Tuition and Fees Deduction: Deducting qualified tuition and related expenses even if you do not itemize deductions on Schedule A, Form 1040.
  • Student Loan Interest Deduction: Deducting up to $2,500 of the interest you paid on student loans on your federal individual income tax return.
  • Employer Provided Educational Assistance: You can receive up to $5,250 in tax-free education benefits from your employer each year.
  • Cover dell Education Savings Account: Earnings grow tax-free until withdrawn to pay for qualified educational expenses.
  • Qualified tuition Program: Earnings are tax-free while invested and tax exempt when withdrawn for qualified higher education expenses.

There are other tax provisions that may help your family cover the cost of higher education as well. Such as:

  • Grants and scholarships are usually excluded when calculating the gross income of the student.
  • If an individual receives debt forgiveness following graduation, the recipient does not have to report the amount of the forgiveness as income in certain cases.
  • If a college or university reduces the tuition charged or pays the tuition of the immediate family of an employee, that tuition reduction or tuition payment does not count as income.

Also, keep the following in mind as you explore education tax benefits. The definitions of qualified college costs differ. This means that although one savings or investment option can be used to pay the cost of books or room and board, another might not allow it. Each tax benefit option has different phase-in and phase-out periods as well as varying income eligibility requirements. Also, some tax provisions cannot be used together in the same tax year, so families may need to choose between incentives.

Student Financial Aid

“Where do I begin?” This is the million-dollar question often asked when it comes to beginning the student loan and financial aid process. I have outlined the steps to applying for financial aid in the order you should complete them.

You have made a great first step by doing some research, but we cannot stress enough that you need to research financial aid in all its forms. Visit financial aid on the net to learn the basics and become familiar with terms such as FAFSA, Guarantor and many other words and acronyms that you probably will not come across in everyday life. It is definitely worth your time and effort to learn about the financial aid process now, before you start filling out forms. It can potentially help you save money as well.

Complete the FAFSA:

Ensure that you or your child has completed the appropriate FAFSA application. You can find application advice and submission, free, on line at http://www.studenteducationloan.cn or the dept. of education site. To have your FAFSA professionally prepared and files, like a tax preparation service, visit http://wwweducationloan.info, to receive a federal Student loan, you must fill out a FAFSA application.

Find Scholarships:

A Scholarship is money you do not have to give back. Scholarships exist at the local and national level, so be sure to look into all your options, including local fundraising groups, your religious group and national scholarship opportunities. You might consider using a professional scholarship search service for a nominal fee of course. This service can access you to more than $14 billion in essentially free money.

Stafford Loan:

Once you have completed and received the results from your child’s FAFSA, you will then know the amounts he/she has qualified for. At this point is when you need to know obtain a Stafford Loan for the additional money amounts that will be needed. Stafford loans are student loans available through government programs for a low interest rate.


PLUS Loan – Plus Loan for Parents of Undergraduate Students:

After finding out how much federal financial aid your are qualified for your parents can find out if they are qualified to take out a PLUS loan on your behalf. This can help fill in any gaps in your federal need-based aid. Remember it is important to file for the Stafford loan first, then the PLUS loan. You can learn more about both of these loans online.


Still not enough? Alternative Student Loans:

If your federal student aid report indicates that you do not meet the requirements for federal funding, or it falls short of what you need, consider applying for a private student loan. Also known as Alternative student loans. This kind of loan is a credit-based loan you can take out to fund your child’s education. Check this out on line as well.


Alternative Student Loans for parents of grade K-12 students each offer an easy application process with funding in as little as 5 business days at competitive interest rates, making them great choices for students and families with unmet financial needs.

Federal Student Loans

While included in the term Financial Aid higher education loans differ from scholarships and grants in that they must be paid back. They come in several varieties in the United States.

Federal student loans are made to students directly. There are no payments while enrolled in at least half time status. If a student drops below half time status, the account will go into its six-month grace period. If the student re-enrolls in at least half time status, the loans will be deferred, but when they drop below half time, again they will not longer have their grace period. Amounts are quite limited as well.

Federal student loans can also be made to parents. They can obtain a much higher limit, but payments start immediately.

Private student loans made to students or parents have a higher limit and no payments until after graduation, although interest will start to accrue immediately. Private loans may be used for any education related expenses such as tuition, room and board, books, computers, and past due balances. Private loans can also be used to supplement federal student loans, when federal loans, grants and other forms of financial aid are not sufficient to cover the full cost of higher education.

There are two distribution channels for federal student loans, the Federal Direct Student Loans and the Federal Family Education Loans.

Federal Direct Student Loans also known as Direct Loans or FDLP loans are funded from public capital originating with the US Treasury. FDLP loans are distributed through a channel that begins with the US Treasury Department and from there passes through the US Department of Education. Then it goes to the college or university and then to the student.

Federal Family Education Loan Program loans also know as FFEL loans or FFELP loans are funded with private capital provided by banking institutions such as banks, savings and loans and credit unions. Because the FFELP loans use private capital as their source, students who use FFELP loans are able to take advantage of payment options that are similar to those available to customers who take out a home loan or a consumer loan. Some institutions will allow a discount for automatic payments or a series of on-time payments. In 2005, approximately two-thirds of all federally subsidized student loans were FFELP.

According to the US Department of Education, more than 6,000 colleges, universities, and technical schools participate in FFELP. This is a representation of about 80% of all schools. FFELP lending represents 75% of all federal student loan volume.

The maximum amount that any student can borrow is adjusted from time to time as federal policies change. A study published in the winter of a 1996 edition of the “Journal of Student Financial Aid,” “How Much Student Loan Debt Is Too Much?” suggested that the monthly student debt payment for the average undergraduate should not exceed 8% of total monthly income after graduation. Some financial aid advisers have referred this as the 8% rule. Circumstances vary for individuals, so the 8% level is an indicator not a set rule.

Student Loans Consolidation Rates

Student Loans Consolidation Rates


To calculate student loans consolidation rate you must first understand all the interest rates of your loans you wish to combine. The federal consolidation student loans consolidation rate is dependent upon these figures.

Currently, federal student loans awarded after June. 31, 2006 have an interest rate of 6.8 percent (all numbers are as of January 2008). Student loans that were taken out prior (or on) this date feature an adjustable interest rate. These loans are up for re-adjustment annually in July. The adjustment depends solely on the results of the 91-day Treasure Bill Auctions. The following rates apply through June 2008.

Stafford Loans in grace period – 6.62 percentStafford Loans in repayment – 7.22 percentParent PLUS Loans (disbursed after July 1, 1998) – 8.02 percentParent PLUS Loans (disbursed after July 1, 2006) – 8.50 percent

Your student loan consolidation rate will be calculated by the weighted average of your current student loans. What does this mean? For example, if you have three loans with three different interest rates, you multiply the outstanding student loan balance by its interest rate. In other words, if you have a loan for $10,000 at 5.99 percent interest, you would multiply the two numbers to get 59,900. Do this for each loan. Next, add the totals from all three loans. Let’s say that number equals 137,775. Now, total the outstanding loan balances and divide them by the amount you came up with in step two. Finally, round the result to the nearest 1/8th percent. Sound complicated? If you are not good with numbers, find a consolidation calculator online to tell you what the weighted average of you loans is.

As you can tell, the student loans consolidation rate varies greatly. If you are interested in figuring your rate, but don’t know the amounts or rates of your current federal education loans, visit the NSLDS from ED.gov to access this information.

Federal Student Loan Consolidation

Now that you are facing the stress of dealing with the repayment of your student loans, you may want to opt for consolidation. Student loans consolidating can be tricky, and several factors need to be taken into consideration when making your decisions. However, if you decide that the benefits of consolidation outweigh the drawbacks, you can find a way to make it work, whether you have federal or private loans.

There is a difference between consolidating federal and private loans. The most glaring difference is that, with a Federal Consolidation Loan, your interest rate is fixed in keeping with a federal formula, while private consolidation interest rates can be either fixed or variable. Variable means that the interest rate can increase at any moment. If you are consolidating both types of loans, you should make sure to keep them separate.

When Consolidating Federal Student Loans, the borrowers are generally allowed up to 10 years to repay, when they consolidate Federal Stafford and Graduate PLUS Loans. However, some borrowers can qualify for the government’s Extended Repayment Plan. Borrowers who consolidate student loans through the Federal Consolidation Loan Program can refinance one or multiple student loans into one new fixed-rate loan. In other words, the original loan is paid in full and another one is initiated.

Anyone with eligible Federal Student Loans can get a Federal Consolidation Loan, and can do so without paying loan fees. Interest rates are fixed for the life of the student loan. Rates are based on the weighted average of the interest rates of the loans being consolidated, rounded up to the nearest one-eighth-percent or 8.25 percent, whichever is less. Borrowers do not need a credit card, and the fixed interest rates allow them to avoid future variable rate increases.

You must meet certain eligibility requirements for student loans consolidation received from the federal government. To qualify, the borrower must have one or more appropriate Federal Student Loans with a combined balance greater than $10,000. The borrower also must have left school, graduated or must be attending school less than half the time.

Borrowers may have only one Federal Student Loan Consolidation application in process at a time, and the loans must be in good standing, not in default. The borrower’s loans must also be in a grace period, deferment, forbearance or repayment status at the time of application.

Eligible Federal Student Loans include:

  • All Federal Stafford and Direct Loans
  • Graduate PLUS Loans
  • Federal Perkins Loans
  • Health Professions Student Loans
  • Nursing Student Loans
  • Federal Supplemental Loans for Students
  • Auxiliary Loans to Assist Students
  • National Direct Student Loans
  • Federally Insured Student Loans
  • Federal Consolidation Loans
Graduate PLUS Loans can be consolidated as soon as they are disbursed to the school, while Federal Stafford Loans can be consolidated only after graduation. A borrower with a subsidized or unsubsidized Stafford Loan must be consolidated with the government’s Direct Consolidation Loans Program.

Student Loan Consolidation Services, Consolidate Loans 2

Student Loan Consolidation Services

Student loan consolidation services provide a wide variety of servicing functions for borrowers. A big part of the services include deferment programs that help alleviate the hardship associated with repayment based on different seniors. The following is a list of deferment student loan consolidation services offered to borrowers who qualify.

Economic Hardship –Borrowers who earn less than minimum wage or exceed the federally established debt-to-income ratio, there is the economic hardship deferment. Individuals who qualify for public assistance or are serving in the Peace Corps also qualify for this deferment.
Graduate Fellowship – Student loan consolidation services provide eligible graduate students a deferment option.

In-School Deferment – Part time and full time students studying at eligible schools can request a deferment.

Internship/Residency – Individuals enrolled in a qualifying internship or residency program can apply for a deferment. This program also covers borrowers in a medical training program that leads to a degree or certificate award by their institution, hospital, or health care facility.

Parental Leave – Borrowers can request a deferment if the individual is pregnant or caring for a newborn or newly adopted child.

Temporary Total Disability – If a borrower experiences temporary total disability or is unable to secure a job because they are caring for a dependent or spouse who is disabled, they can apply for a deferment. Borrowers who experience permanent disability should inquire about the cancellation of their loan.

Unemployment – Individuals who are seeking work, but are not employed full time can apply for a deferment. The borrower can receive unemployment benefits and qualify for a deferment.
Teacher Shortage Area – Teachers who work full time in a public or non-profit elementary school or secondary school may be able to qualify for a deferment if the are they work in is experiencing a teacher shortage.

Additional information on student loan consolidation services and deferment programs can be found by visiting sites such as college-loans.net. Deferments available to you depend on the type of consolidation loan you have and your lender.

Student Loan Consolidation Services, Consolidate Loans 1

There are several different options available for students in terms of student loans; however, the following are the 10 Best Student Loan Options:

Subsidized Stafford Loan

  • Unsubsidized Stafford Loan
  • Federal Perkins Loan
  • Federal PLUS loan for parents
  • Direct PLUS loans
  • Federal consolidation loan
  • Federal Nursing Loan
  • Federal Insured Student Loan
  • Health Professions Student Loans
  • Private student loans

Let us take a closer look at more information regarding the 10 best student loan options that anyone considering college student loans should consider:

1.The Subsidized Stafford Loan is available for both graduate and undergraduate study. While the student is in school, the federal government pays the interest on the loan. This loan is need based, so not all applicants may qualify.

2.The Unsubsidized Stafford Loan is also available for graduate and undergraduate study. Unlike the Subsidized Stafford Loan, with this loan the student is responsible for the interest that is accrued on the loan while they are in school. This is not a needs based loan, so students may be eligible for the loan even if they do not show a financial need for the loan.

3.The Federal Perkins loan is a type of student loan that is available to both graduate and undergraduate students. Applicants must demonstrate financial need in order to qualify for this loan. Funds are disbursed by the school and must be repaid to the school.

4.The PLUS loan program gives parents of students the option to borrow up to 100% of their child’s cost of education. Parents are eligible for this loan even if they do not demonstrate a financial need and regardless of income.

5.Direct PLUS loan: this type of student loan is available to parents and guardians of dependent undergraduate students. Borrowers do not need to demonstrate financial need and may borrow up to the cost of attendance; minus any amount of financial aid that may have received. Loan funds are first applied to tuition and fees. This type of government and federal student loan has a variable interest rate.

6.The federal consolidation loan program gives students and their parents the option to consolidate loans and take advantage of lower interest rates and monthly payments.

7.The federal nursing loan gives students who are enrolled in nursing school the option of a low interest loan and flexible repayment options. Loan cancellation is available in some cases.

8.The Federal Insured Student Loan program gives students who might not otherwise qualify for a student loan the ability to receive the funds they need to complete their education. This is in fact in my opinion the Best Student Loan available.

9.The Health Professions Student Loan provides long-term, low interest loans to students pursuing degrees in dentistry, optometry, pharmacy, veterinary medicine or podiatry.

10.Private student loans require a credit check for borrowers; however, students and their families are typically able to borrow more money than they would have been able to through a federal student loan.

Keep Your Government Student Loan Simple

Keep your government student loan simple, that could be your motto during the process of applying for federal government student loan. The easiest way for you to do this is to be sure you have all of your pertinent information ready to go onto a government loan form at a moments notice. The documents you need to get approved for a government student loan are numerous, so start planning now.

But what all do you actually need for your government student loan? First of all you need the basics for your government student loan application, such as your social security number, your birth certificate and your drivers license number (if you have one).

The next things you need to gather to be able to apply for a government student loan is anything that has to do with the money you make. This will include your w2 forms and all other earnings statements you can track down. These all can affect your government student loan application.
If you were to wait until after you applied for the student loan to get this all together the chances of getting approved for any government loan goes way down. Organization really is key to getting the government student loan that you need.

You also don’t want to wait until the last minute to apply for the government student loan. There are often time limits to a government student loan as well as a limit to the amount of money that any government student loan can give out. The sooner you apply the better your chances of getting the government student loan. Start planning early, well before you actually graduate from high school, this will mean you never miss a deadline when it comes to the government student loan application.

It is your responsibility to check out the different deadlines that each school has when it comes to most all student loan types, aside from private. They are always different and if you miss getting your government student loan application in on time then you will be out of luck. This government student loan is going to affect the rest of your life, so take this seriously and be organized. Start planning early and have all of the forms and documents you need ready to go, this will make applying for a government student loan simple and easy.

Student Lending

Need help paying for college? Here is a little information on available financing.

When it comes to big-ticket items, you have to pay for in your lifetime, it does not get much bigger than higher education. Indeed, predictions are that college tuition will increase by about twice the rate of general inflation, year over year. This would mean, in 20 years, the average annual cost of tuition for a four-year public program would rise from today’s $5,132 to $19,859 and the cost of a private program from $20,082 to $77,711.

Nevertheless, help is at hand. For want to be college students (and their parents) who could benefit from a financial leg up in this department, here is a primer on what is available.

What types of aid are available? The ideal sources of funding for your child’s education are scholarships and grants that do not require repayment. Even those lucky enough to qualify rarely receive enough to foot the whole bill. Fortunately, there are several types of student loans. They are distinguished by various factors, including their rates of interest, repayment terms, and maximum available amounts and whether the onus of repayment falls on the student or his or her parents.

Some principal sources of student financial aid are:

· Federally funded student loans

· Parent loans

· Private loans

· Other loans

· State aid

· Institutional assistance

First, let us talk about a Federal student loans. The U.S. Department of Education’s Federal Student Aid (FSA) programs provide nearly 70 percent of all financial aid for American students. FSA is available to students — both undergraduate and graduate — enrolled in eligible programs at participating schools. In most cases, they are granted based on a student’s need.

Stafford loans are long-term, low-interest loans regulated by the federal government. They are given to students (rather than to their parents) and must be repaid with interest following the completion of their education term.

How much can one obtain from a federal student loan? A student’s financial need is calculated based on his or her expected family contribution (EFC), academic level and the anticipated cost of his or her education (including tuition, room and board, and books). Worksheets that show how the EFC is calculated are available at www.studentaid.ed.gov/pubs, or you can request a free copy of the EFC Formula by calling 1-800-4ED-PUBS, and asking for the Federal Student Aid Handbook.

When would you need to pay your student loan back? Students are required to begin paying off their Stafford loan debt six months after they graduate, or after their enrollment drops to less than half time.

Where to Apply for a Student Loan

Where to Apply for Student LoansStarting college can be a bit overwhelming to say the least. Applying for student loans can add to the stress. It is important to know where to go to apply for student loan. There are many types of student loans out there for students to choose from so you want to be sure that you go with the loan that meet your specific needs. Some students need the student loans that will just help them pay for college expenses such as tuition and books where other students need the college funding that will help them with living expenses as well, which are commonly known as private student loans.
One of the first places that you should check with would be the financial aid office of your college of choice.

They can advise you on the top student loans and where and how to apply to each of them. You will find that when you are applying to federal student loans or government student loans, you can apply by simply filling out just one application.

There are also private lenders that offer personal student loans to students as well as parents for their child’s education. You can look into such places as banks and credit unions for loans and what options that they can provide to you. There are plenty of places to look into right in your own neighborhood. Many company’s (possibly where your parents work) offer programs offering student loans for the employees children as part of their benefits package so you may want to have your parents look into this.

The Internet can provide a wealth of information where student loans are concerned. You can compare many student loans on one website, with just a simple click of the mouse. Many of these sites will also calculate what your possible monthly payments would be on your student loans. These calculators are very handy when you are trying to plan your budget and to see where you may need additional help to help with your college education.

Be sure to check into each of the student loan lenders that you are considering that are online. You want to be sure that you are getting the best of the student loans that you can get and you do not want to be stuck into one of the high interest rate loans. Be sure to read the fine print on the application so you know exactly what you are getting yourself into. And something of the utmost importance: Involve your parents.

Direct Student Loans

The U.S. Department of Education administers the Federal Family Education Loan (FFEL) Program and the William D. Ford Federal Direct Loan (Direct Student Loan) Program. Both the FFEL and Direct Loan programs consist of what are generally known as Stafford Loans (for students) and PLUS Loans (for parents).

Schools generally participate in either the FFEL or Direct Student Loan program but sometimes participate in both. Under the Direct Loan Program, the funds for your loan come directly from the federal government. Funds for your FFEL will come from a bank, credit union, or other lender that participates in the program. Eligibility rules and loan amounts are identical under both programs, but repayment plans differ somewhat.

For either type of loan, you must fill out a FAFSA. After your FAFSA is processed, your school will review the results and will inform you about your loan eligibility. You also will have to sign a promissory note, a binding legal document that lists the conditions under which you are borrowing and the terms under which you agree to repay your loan.

You will need to choose a lender if you obtain a FFEL Stafford Loan. Schools that participate in the FFEL Program will usually have a list of preferred lenders. Student loan borrowers may choose a lender from that list, or choose a different lender they prefer (for example, a credit union). Here are a few things to think about when selecting a FFEL lender.

The amount in which you can borrow depends on your year in school and whether you have a subsidized or unsubsidized Direct Student Loan or FFEL Stafford Loan. A subsidized loan is awarded based on financial need. If you are eligible for a subsidized loan, the government will pay (subsidize) the interest on your loan while you are in school, for the first six months after you leave school, and if you qualify to have your payments deferred. Depending on your financial need, you may borrow subsidized money for an amount up to the annual loan-borrowing limit for your level of study.

You might be able to borrow loan funds beyond your subsidized loan amount even if you have not demonstrated financial need. In that case, you would receive an unsubsidized loan. Your school will subtract the total amount of your other financial aid from your cost of attendance to determine whether you are eligible for an unsubsidized loan. Unlike a subsidized loan, you are responsible for the interest from the time the unsubsidized loan is disbursed until it is paid in full. You can choose to pay the interest or allow it to accrue and be capitalized. Capitalizing the interest will increase the amount you have to repay.

You can receive a subsidized loan and an unsubsidized loan for the same enrollment period as long as you do not exceed the annual loan limits.

If you are a dependent undergraduate student, each year you can borrow up to $3,500 if you are a first-year student enrolled in a program of study that is at least a full academic year. Alternatively, $4,500 if you have completed your first year of study and the remainder of your program is at least a full academic year. Alternatively, $5,500 if you have completed two years of study and the remainder of your program is at least a full academic year.

If you are an independent undergraduate student or a dependent student whose parents have applied for but were unable to get a PLUS Loan, each year you can borrow up to $7,500 if you are a first-year student enrolled in a program of study that is at least a full academic year. No more than $3,500 of this amount may be in subsidized loans. Alternatively, $8,500 if you have completed your first year of study and the remainder of your program is at least a full academic year. No more than $4,500 of this amount may be in subsidized loans. Alternatively, $10,500 if you have completed two years of study and the remainder of your program is at least a full academic year. No more than $5,500 of this amount may be in subsidized loans.

If you are a graduate or professional degree student, each year you can borrow up to $20,500 for the 2007-08 academic year. No more than $8,500 of this amount may be in subsidized loans.

When you graduate with a graduate or professional degree, the maximum total debt allowed from Stafford Loans is $138,500. No more than $65,500 of this amount may be in subsidized loans. This maximum total graduate debt limit includes Stafford Loans received for undergraduate study.

These amounts are the maximum yearly amounts you can borrow in both subsidized and unsubsidized FFELs or Direct Loans, individually or in combination. Because you cannot borrow more than your cost of attendance minus the amount of any Federal Pell Grant you are eligible for and minus any other financial aid you will get, you may receive less than the annual maximum amounts.

Scholarships for Women and Minorities

The Ins and Outs of Scholarships for Women

Over the last few decades, women have entered the work forces of America in bigger and bigger numbers. Gone are the days when men went to post secondary school, and earned a living for their family, while the women stayed home and kept house.

In today’s world, women play as important a roll in the U.S economy as men. A lot of family’s can no longer afford to live on one income, and women are no longer constrained by archaic social norms.

However, in certain sectors of the economy, women are sadly absent. It’s in these sectors, which include business schools, economics, engineering and other jobs which are still seen as being “manly,” that you will find schools which offer plenty of scholarships for women.

While you can probably find scholarships for women in practically every field of study, a student’s best bet of getting a scholarship for women is in one of these areas of study.

Unlike in bygone years, there are also a lot more scholarships for women to be found in the sporting categories. In the past, most sporting scholarships were given out to male athletes, but there has been quite an increase in sporting scholarships for women in recent years.

The Magic of Minority Scholarships

The rise in Minority’s in the U.S is overwhelming, and many people who first come to the U.S or in some cases are already here, don’t have the financial backing for a post secondary education. Yet, like everyone, they want what’s best for their children, and grandchildren.

It’s important that everyone, including minorities, get a chance at a fair education, which includes everyone, and helps them get the job they want. This is why there are scholarships that are exclusively for the minority segment of the population.

Minority scholarships offer the chance for hard working students to get ahead in life. For some, a minority scholarship is the only way they will be able to go to college or university at all.

In 2003, Universities and colleges were facing litigation and pressure from Washington, because of a ruling by the Supreme Court, that didn’t ban race being used for admissions into higher schooling, but left the law unclear.

This put pressure on minority scholarship funds to allow white people to get money that was previously only available to minority groups. While minority scholarships can still be found that cater to just minorities, there are quite a few minority scholarships that were forced to expand their available pool of minority scholarship money, to allow for non-minorities to get a scholarship too.

Still, you can find a lot of minority scholarship opportunities on the web. A prospective student can find, and apply for, a minority scholarship online. First we advise you start reading all you can about how to locate a college scholarship.

The guidance councillor is another excellent source of information on minority scholarships. It’s their job to be aware of scholarships, including minority scholarships, and they can probably help you find one that will best suit your needs.

Sometimes, businesses will offer minority scholarships as well. Perhaps you’re employed at a place which offers a minority scholarship, and you’re unaware of it. Either that or perhaps your parents work at a place that offers minority scholarships.

Businesses throughout the United States pump millions of dollars into minority scholarships. So does Government, and individuals, so that minorities have a better chance of breaking out of the low income cycle they may find themselves in, and can afford to go to school.

The U.S government, and businesses, by giving out and supporting minority scholarships, are showing that they don’t want to see the significant assets and skills that many people, including minorities, have to offer to the country, and business in general, go to waste.

If you’re in need of quick funds for college, consider one of the many lenders listed on our private student loan lenders page. Best of luck to you all. Please borrow and pay back responsibly.

Tips For Repaying your Student Loans

You have a choice of repayment plans if you received a FFEL or a Direct Student Loan. Federal Perkins Loans do not have repayment plan choices. Generally, you have up to 10 years to repay. Your monthly payment will depend on the size of your debt and the length of your repayment period. Note to parents: Generally, Direct PLUS Loan borrowers can choose all but the Income Contingent Repayment Plan. FFEL PLUS Loan borrowers usually can choose from among all the FFEL repayment plans. In some cases, you might be able to reduce your interest rate if you sign up for electronic debiting.

If you do not repay your student loans on time or according to the terms of your promissory note, you might go into default, which will affect your credit rating. There is assistance for borrowers having difficulty repaying their education loans, including deferment and forbearance.

If you are a teacher serving in a low-income or subject matter shortage area, it may be possible for you to cancel or defer your student loans.

There is a new loan forgiveness program for public service employees. Under this program, the amount forgiven is the remaining outstanding balance of principal and accrued interest on an eligible Direct Student Loan for a borrower who is not in default and who makes 120 monthly payments on the loan after October 1, 2007. The borrower must be employed full-time in a public service job during the same period in which the qualifying payments are made and at the time that the cancellation is granted.

A Consolidation Loan allows you to combine all the federal student loans you received to finance your college education into a single loan.

If you default, it means you failed to make payments on your student loan according to the terms of your promissory note. The legal document you signed is binding at the time you took out your loan. In other words, you failed to make your loan payments as scheduled. Your school, the financial institution that made or owns your loan, your loan guarantor, and the federal government all can take action to recover the money you owe. I have outlined some consequences of default:

  1. National credit bureaus will be notified of your default, which will harm your credit rating severely, making it hard to buy a car or a house.
  2. You would be ineligible for additional federal student aid if you decided to return to school.
  3. Loan payments can be garnished from your paycheck.
  4. State and federal income tax refunds can be withheld and applied toward the amount you owe.
  5. You will have to pay late fees and collection costs on top of what you already owe which only increased your debt and burden.
  6. You can be sued.

You obviously do not want to let your direct student loan go into default. However, should this happen, find out what options are available. Click on this link to a Federal aid site http://www.ed.gov/offices/OSFAP/DCS/ to find comprehensive information developed by the Department’s FSA Collections section. Clicking on various tabs within that publication will give you information about how to remove your loan from default, what to do if you have a dispute about your loan’s default status, and how to get answers to questions you might have.

For further information on a default or any kind of forgiveness of a student loan, go online and do so checking. You will find credible information that can help you in a very bad situation.

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