Student Loans Insight

The purpose of any Financial Aid Office is to help provide education and information, guidance, and support for college students as well as families interested in the financial aid process.

In this role, they will:
• Process applications
• Determine eligibility
• Exercise stewardship over any funds
• Adhere to the rules and regulations governing the distribution of financial aid
• Minimize procedural barriers
• Provide efficient service to college students who have completed the necessary requirements.

A Financial Aid Office recognizes the distinct needs of all college students and families, and will project a positive attitude with each interaction. Through outreach efforts, they will support the mission of Enrollment Services and the overall mission of the college or university you have chosen to attend.

More than not, U.S. citizens and permanent residents will be found eligible for federal financial aid assistance regardless of there family income! However, only by completing the FAFSA Online can the kind and amounts of financial aid assistance be determined. Federal financial aid assistance is a superior financial option to a private college student loan.

1. Grants will not need to be paid back if the college student meets all of the requirements of the award.
2. Loans are money that is borrowed from either federal, state, institution, or private lenders.
3. Scholarships are assistance that does not need to be paid back as well if the student meets all conditions.
4. Work-Study is a college student employment program with many unexpected benefits.

Pell Grants

The Pell Grant is the most common of the federal grants and is an entitlement grant based on financial aid need. The Expected Family Contribution (EFC) is calculated by completing the FAFSA and is used as an index to determine eligibility for a Pell Grant. Only college students who have not yet earned there bachelor’s degree are eligible to be awarded a Pell Grant.

Academic Competitiveness Grant (ACG)

First or even second year college students who have completed there academically rigorous high school program can be eligible for the ACG. ACG recipients must be eligible for a Pell Grant as well, a U.S. Citizen, and enrolled in 12 or more credits each semester.

National Science and Mathematics Access to Retain Talent (SMART) Grant

The SMART Grant will provide $4,000 per school year for up to two years, and is also open to third and fourth year college students enrolled in a four year degree program in a specific subject area and who have maintained a cumulative 3.0 GPA. Eligible college students must be U.S. Citizens, Pell Grant award recipients and enrolled in 12 or more credits per semester, and each semester, you must be enrolled in at least one class required for your eligible major. Eligible subjects can include mathematics, computer science, many engineering majors as well as the hard sciences.

Federal Supplemental Educational Opportunity Grant (SEOG)

There are also small grants available to high need college students who are also Pell Grant recipients. You will automatically apply for this grant when you complete the FAFSA. SEOG recipients must be enrolled in at least six credits to become eligible.

Leveraged Educational Assistance Program (LEAP) Grant

This is also a small grant typically available to Priority Financial Aid Applicants who are also Pell Grant recipients. You automatically apply for this grant as well when you complete the FAFSA. LEAP recipients must be enrolled in at least six credits to be eligible.

Federal Pell Grants of up to $4,000 were awarded last year to undergraduate college students with the most need. Even if you are enrolled less than half time, you can still qualify for a Pell Grant. This is free money. You will not pay it back.

Most states do have programs similar to the Federal Pell Grant. They provide grants (on a first come, first served basis) to college students who live and attend college in there particular state.

Federal Supplemental Education Opportunity Grants (SEOG) can be awarded much less frequently. Funds totaling as much as $4,000 per year can be available to qualifying undergraduate college students. In addition to financial aid need, these awards will also depend on the Federal SEOG funds that are available at your college. The amount of other financial aid you receive will also be a factor.

Institutional grants and scholarship programs are also available through many schools. Funds are limited however, so you really need to apply early for this award.

Federal Work-Study (FWS) will let eligible college students earn a specified amount of money to help with there educational or personal expenses during the year. Jobs will usually pay minimum wage, maybe a little more, and a variety of job classifications will be available. Full time college students will usually work between 10 and 20 hours a week.

Federal College Student Loans will make up about 80% of all federal financial aid college student loans, so it really is likely that one or more of these college student loans will be part of your financial aid package. College student loans are borrowed and will have to be repaid. Because college student loans are so important for college students today, there is much information you can find on them. You can search for specific information as well as general information on a specific college student loan. Be sure you read carefully all the information you do find.

Tax Incentives and Benefits For Your College Student Loan

For college students or their parents or spouses, assistance can be available in the form of tax credits and deductions that might be applied to your federal tax returns.

You should talk with a tax advisor for total and complete details, including any restrictions that may not have been mentioned here. You may also find helpful information in IRS Publication 970 or at the IRS website www.irs.gov .

It is very important to determine how well your resources will match up with what you will be expected to pay.

To get a total picture of the resources you will need, compare your available funds with your colleges Cost of Attendance and your Award Letter.

Your Expected Family Contribution is rarely the same amount you actually have to pay. Some college students might find that they in fact have budgeted more money than necessary. However, others will still need help to meet these costs. These college students usually need a private college student loan to help meet their costs.

For More Information on federal financial aid college student loans you can learn about other sources of federal financial aid on the internet at the below sites:

U.S. Dept of Education - www.ed.gov
FAFSA on the Web - www.fafsa.ed.gov

Resources are also available at your school or library as well as the financial aid office of the college of your choice.

College can be very expensive. That is why most of us need college student loans to help pay for our higher education. Many college student loans will come from the federal government but sometimes they just will not cover the total cost of education. For college students requiring more money to pay for school there are student loans that can be provided by a private lender.

Private student loans are one of the best ways to cover additional education costs while earning a degree. Private lenders or financial institutions can offer an affordable way to pay for college as well as increase your lifelong earning potential. Earning your degree is one of the most important steps you can take to living the life you dream of.

Private student loans will usually offer a quick application process, quick approval and low interest rates. These types of college student loans can provide you with the extra money you are needing to complete your education and start on your road to success.

Stafford College Student Loans

Federal Stafford College Student Loans are student loans that are available to college and university students who are in need of additional funds to supplement their personal and family income. Almost all college students are eligible to receive these federal loans regardless of their credit history. Stafford College student loans can be subsidized by the U.S. Government or college students can get unsubsidized loans depending on the student’s financial aid need.

Stafford College Student Loan Eligibility:

• You must have submitted a FAFSA to be eligible for Stafford college student loans.
• For a subsidized Stafford college student loan, financial aid need must be present as determined by your school.
• Student must be a U.S. citizen/national, a U.S. permanent resident or eligible non-citizen.
• Student must be enrolled or planning to enroll as a half time college student.
• Student must be accepted to a school or attending a school that participates in the Federal Family Education Student Loan Program.
• Student must not be in default on any education student loan or owe a refund on an education grant.

Federal College Student Loans

Federal college student loan programs are the single largest source of college student loans. There are two main programs that will grant money to a college student in need:

1. The Federal Family Education Loan Program (FFELP) and
2. William D. Ford Federal Direct Loan Program (FDLP).

College students can apply for a FFELP student loan through private banks, credit unions, or educational finance companies. Your college or university might recommend specific institutions, but you are free to get your college student loan from any financial institution participating in the program.

These college student loans have very good terms as well as repayment options:

• Low interest rates compared to other student loans.
• Student’s interest payments can be paid by the federal government while in school.
• Students may not need to make student loan payments while in school.
• Longer repayment terms when compared to other college student loans.
• Students can benefit from flexible credit requirements.

Many schools participate in the Federal Direct Student Loan Program where the loans have the same terms as FFELP student loans, but money is borrowed from the U.S. Department of Education.

Unfortunately, we have come into a time that can be difficult to consolidate an existing student loan. This is not to say it cannot be done. This is only to say you may have to do your homework. Any ways you are going to college, you know how to do homework. Over the past year, the college student loan market has seen some unprecedented changes. The changes that have been made to the structure of a college student loan program that are guaranteed by the federal government (but are actually issued by banks and financial institutions) have forced many lenders to no longer offer incentives or rewards to borrowers and in many areas, to discontinue offering new college student loans altogether. Federal student loan consolidation has been especially hard hit. In general, these college student loans can be unprofitable for individual financial institutions to issue under the new regulations. As a result, obtaining comparisons on said loans becomes harder and harder. Do not give up though; you still have many options to choose from, such as:

• Contacting your current lenders about restructuring the repayment on your existing loans. Federal college student loan repayment can very well be extended and modified in ways to help you achieve a more manageable monthly payment.
• Obtain a federal student loan consolidation from the Department of Education’s Direct College Student Loan Program. The interest rate on a federal student loan consolidation will be fixed, and the length of a federal student loan consolidation can also be extended for up to 30 years, which will also help lower the amount of your current monthly payments.

If market conditions do change and lenders restart their federal student loan consolidation programs, it will become much easier to compare these types of student loan consolidations.

What About A Private Student Loan Consolidation

There are still many options out there for a private student loan consolidation. The first thing you need to do is start with the existing lender. Give them a call and talk with them about the options. You will always have the options to talk with other lenders and financial institutions as well for a student loan consolidation. The rule of thumb for a lender is, if you have the credit history we can do something for you.

Consolidation of a private student loan is some what of a new option, and many lenders and financial institutions are still fine tuning there offers. Make sure you do your homework before you consolidate a private student loan and be aware of prepayment penalties as well as monthly payment rates that will start out on the low end but increase considerably over time.

When Should You Consolidate You Student Loans?

If you only have a newer federal loan (issued on or after July 1, 2006), then it does not matter when you consolidate. These college student loans have fixed rates, so you will not benefit by consolidating them at any particular time when rates may be lower. However, if you have older federal college student loans (issued before July 1, 2006), then timing will be important.

There are three general time periods you should consider for federal student loan consolidation if issued before July 1, 2006:

• You are still in school
• You have left school, but have not started repayment
• You are in repayment

Student Bank Loan, Private College Student Loan, Alternative Student Loan, and that is only the private sector of the College Student Loan group. Then you have the federal student loans such as the Stafford College Student Loan, subsidized or unsubsidized, Perkins College Student Loans, Plus (for parent) Student Loans. The list actually goes on and on.

The important thing to know is to do your homework. Do not take the first thing that comes along research everything. When you have decided what college or university, you will be attending, go talk to the financial aid office of the school. I know the first thing they will tell you to do is the Free Online FAFSA application.

There are several reason you should start there. One pretty major reason being you could qualify for FREE money. Now who does not want to get free money? Meaning you do not have to pay it back. This would be called a Pell Grant. Very good start. Once you have completed your free online FASFA application, you will receive a SAR report telling you exactly what you do qualify for through the federal government program.

In most cases, you will qualify for more than one loan or grant. For instance, when I applied for my last loan for schooling through the FASFA I qualified for a large Pell Grant (free money), a subsidized Stafford College Student Loan as well as an unsubsidized Stafford College Student Loan. When all was said and done, I did not have to seek any more funds for my schooling, it was paid for in full.

That is not to say everyone will qualify for these kinds of loan, but what ever your financial situation, do the FASFA. The chances are pretty good you will qualify for something.

Once you have determined what is being taking care of with the federal college student loan, and a balance is still needed to be applied towards school, this is when you start looking at your options for a student bank loan, private student loan, or alternative student loan. No matter what you call it, it is all the same. However, the interest rate and terms are going to be very, very different.

Buy applying and qualifying for the federal college student loans, you have completed the easy part. Now it gets just a little bit trickier. If you have not yet established credit or have little or poor credit you will probably need to seek the help of a co-borrower. A co-borrower is someone that is willing to sign on the student bank loan with you, stating they will take responsibility if for some reason you fail to make your payments. This could be a very big undertaking for most to even consider doing for someone. However, if you find you just do not have anyone that would be willing to do this for you things may get difficult.

At this point, the chances of getting that student bank loan are less, but there are many options out there for those with bad credit. Unfortunately that just means you will be paying a higher interest rate and your terms could be not so great. The point is, there are many options for everyone. You just have to do your homework and research to find those options. The internet has a wealth of knowledge as well as friends and family. Ask around and find out what others have done. You will get good quality feedback.

Once you have submitted all additional documents requested, your financial aid application should be complete. The information you have submitted will be reviewed for completeness and accuracy and the college of your choice will compute your eligibility for financial aid assistance. If you have been admitted to attend a particular college, you will receive notification of your financial aid assistance awards available to accept or decline. You may receive this via on-line or through the mail. Depending on the information you have provided and how your college generally handles this. Your financial aid award letter will offer detail on the types and amounts of financial aid assistance that you have become eligible to receive. Usually your on-line financial aid assistance offer will include all information regarding your cost of attendance, your expected family contribution, as well as the quarterly award amounts of the funds that have been specifically awarded to you. Notification of financial aid assistance offers are usually sent to all eligible college students beginning in the spring.

It is important for you to accept your awards as soon as you have received notification that you have been awarded. If you accept any college student loans and you are a new borrower at any college, you will also need to submit promissory notes and complete student loan entrance counseling before any awards will be disbursed.

• New Stafford college student loan borrowers will complete promissory notes online or at the financial aid office of your school.
• Perkins college student loan borrowers complete promissory notes online or at the financial aid office of your school.
• Entrance counseling is available on-line or at the financial aid office of your school.

Failure to accept your financial aid assistance awards and submit any required student loan promissory notes and complete student loan entrance counseling, by the stated deadline could very well result in partial or full cancellation of your financial aid assistance awards. Correspondence are generally sent to your student web mail account via e-mail year round, so be sure to check your account regularly. Do not lose out on financial aid assistance because you are not reading your web mail or other types of mail!

It is very important to report any changes in your expected housing plans or enrollment status or if you will be receiving any other resources (such as outside scholarships, assistance from the Veterans benefits, etc.,) be sure to mark these changes on the financial aid revision forms. You can find these forms on your schools website or at the financial aid office of your school.

Check your award status on on-line or with your school financial aid office! Continuing college students and new admitted college students are encouraged to keep in touch with your financial aid office via email or personally. They are there to help you out during your years at college. Let them do there job and make things easier on you. When it is all said and done you will be so happy you had a helping hand to guide you in the right direction.

As you look into College you might want to keep current with the different types of News out there about Student Loans. It does not matter if you are looking for a private school loan, law school loan, or school loan consolidation you will benefit from knowing the information available. With today’s economy changing and more for the worse, being smart about money is not only a good idea but also a fact of life. The cost of living has gone up, while for many their incomes have not or the increase is often not enough to meet their needs as they attend school.

When you consider whether or not you might need help you have to look beyond the economy and into other areas of the market as well. Such as the situation with mortgages, lower amounts of summer jobs, the stock market troubles, and lets face it some of the lenders for college loans have pulled out as well. Now all of this doesn’t mean you can’t go to college just that you need to look at the financial cost a lot more carefully. More and more colleges said that their students tend to rely on the state and federal aid more simply because the private funding is dropping drastically.

As the mortgage situation got worse so did the private lending for college loans, they say the rapid increase in sales with a huge increase in rates, this made the lenders worry about their money and pull out. Now if you don’t believe that it has gotten that bad consider one of the larger banks of the United States, Bank of America has pulled their private student loan funding.

The choice of courses has changed with the times as well, more and more students are looking into economical courses instead of one they may have chosen in the first place with the right funding. Some of the community colleges lowered their cost of intuition to help with the offset but students and their families are still feeling the pinch. Lenders are looking closer at the upfront criteria and this can affect some of the community colleges in a drastic manner, this is shown by the default rate of the loan getting higher than before.

As you check into the lenders available and the schools they are most likely to lend the funding for the loans, you might want to know that you will need a co-signer and they will have to have a credit rating of 660 or higher. That is a drastic change, as only a couple years ago a student could get a loan with a credit rating of 625 on their own.

Federal and campus based student financial aid consists of:

• grants, which will not have to be repaid
• student loans, which allow you to borrow money for school under federal student loan programs
• work study programs, which will allow you to earn money while going to college.

Grants

• Federal Pell Grants can be based on a combination of financial aid need, college costs, and your enrollment status (full- or part-time). Pell Grants will not have to be paid back.
• Federal Supplemental Educational Opportunity Grants (FSEOG) are campus based grants awarded to college students with exceptional financial aid need. They range between $100 and $4,000 per year and will not have to be paid back.

College Student Loans

The US Department of Education administers Stafford College Student Loans and Federal Perkins College Student Loans (for students), and PLUS College Student Loans (for parents of the college student). Some student loan funds will come directly from the federal government and others will come from a bank, credit union, or other financial institution.

• Stafford College Student Loans can be subsidized (the government will pay the interest while they are in school and for six months after they have left school) or unsubsidized (the student will pay the interest from the date they receive the money, but they can defer payment until after they leave school). A college student can receive both types of Stafford College Student Loans for the same school year, but the total will be limited based on what year they are in and whether they are a dependent (parents can claim them on their income taxes) or an independent college student. Interest rates on Stafford College Student Loans disbursed between July 1, 2005 and June 30, 2006 is 4.70% during in-school, grace and deferment periods, and 5.30% during repayment. The interest rate on Stafford college student loans will never exceed 8.25%.
• PLUS Student Loans will allow parents with good credit to borrow money at a more favorable interest rate to help pay for higher education costs for their dependent undergraduate college student. PLUS Student Loans are limited to the cost of attending college minus any other financial aid received. They are not based on financial aid need. The interest rate will be variable but cannot exceed 9%. The interest rate for student loans disbursed between July 1, 2005 and June 30, 2006 is 6.1%.
• Federal Perkins College Student Loans are campus based, low interest, fixed rate college student loans of up to $4,000 per year for those with an exceptional financial aid need. As long as you are attending school at least half time, you will not have to begin repayment until nine months after you have graduated, leave school, or drop below half time status. No interest will be charged until repayment begins.
• Private College Student Loans can be obtained from private lenders for college costs not covered by federal and campus based financial aid. They will usually include higher interest rates than a federal college student loan; however, they also will not require federal forms (FASFA).

There are so many different types of college student loans and college student loan repayment programs to choose from. This gives you many options. It is important that you learn the difference between the various college student loan types to ensure that you get the college student loan most appropriate for you. First, you do need to assess your needs and identify all of your resources, including financial aid assistance options and of course any savings. From there the college student loan comparison process can be much easier than anticipated.

So how does one get started? Well, first of all, you need to figure out what kind of college student loan you will need. Are you a graduating high school senior looking for that first undergraduate student loan to finance a first year’s worth of tuition, room and board, living expenses and books? Have you been taught the importance of a cosigner? Have you compared college student loans to understand the difference between federal financial aid programs and private student loans, and what your options are with both? Alternatively, are you a seasoned college student looking for a graduate college student loan, law school loan, career-training loan, or business student loan to further your education? Do you know the benefits of a Federal PLUS College Student Loan? Do you want to apply for a medical college student loan or a nursing college student loan to save the lives of others? In addition, if so do you want to know about the college student loan consolidation options you may have? Everything you need to know about college student loans can be found with a little research on the net. I have also but some information together for you below.

College Student Loan Comparison

There are many different student loan types to choose from. The real difference between them all is…do you qualify for a federally subsidized or unsubsidized Stafford College Student loan? What does the PLUS student loan really mean for your parents? How can alternative or private student loans help to finance your college career? You need to find the answers to all of these questions before you proceed.

Undergraduate College Student Loans

Undergraduate college students have many college student loan options to finance their college careers. Student loan types ranging from those available to college students themselves, as well as those available to the college student’s parents. There are alternative or private student loans, as well as federal college student loans to help you. Any of these college student loans or a combination of all may be your answer.

Graduate and Continuing Educational Student Loans

Graduate Educational student loans are available to those college students who have chosen to continue their studies in a graduate degree program. This may include business school, law school, medical school, and more. Additionally Continuing Educational student loans are available for college students who take continuing education course work that may or may not be tied to a degree program.

College Student Loan Repayment Options

It may be easy to apply for a college student loan, but paying it back after you have graduated can be a different story. There may be some circumstances in which you might not have the funds to start paying back the student loans every month. Luckily for you there may be various repayment options that you can take advantage of. Every repayment plan will be different, so choose the one that suits your current financial situation.

Refinancing private student loans can offer many financial benefits but knowing how to do it properly will avoid hassles and protect your lower interest loans.

Students look to many types of loans when seeking money to pay for their college educations. In general, they look in two places – to the federal government and private lenders.

Federal loans come from the U.S. Department of Education, which runs student aid programs.

Private loans come from many different lending institutions. These are unsecured loans and usually carry a higher interest rate than the federal loans.

Many students who borrow to pay for higher education end up having both federal loans and private loans. Federal loans most often don’t contribute enough money to pay the cost of attending a university.

The reason private loans cannot be mixed with money borrowed through federal education programs is that the low interest rates only are available at the federal level. If you do consolidate them, you will lose the interest benefits of the federal loans.

If you wish, you may consolidate your federal student loans, but do so before you consolidate the private loans. Federal student loans have an advantage over private student loans. They carry lower interest rates, tax-deductible interest and you are permitted to extend the repayment term up to 30 years through a consolidation.

Consolidating the private school loans often is a smart choice because the original loans often carry higher interest rates, tight repayment terms and lack the protection of the federal loans.

Most education loans in the private market aren’t competitive, meaning you likely won’t find much benefit in terms of price by refinancing.

There are other benefits though that make a consolidation worthwhile, especially if you’re looking for ways to cut the monthly cost of the loan.

Lumping all of your education loans into one helps make repayment more simple by creating a single payment each month rather than having to pay several lenders. And, refinancing also will create a new repayment term, which often will decrease your monthly payment total.

Of course, by extending the repayment term than originally set, you will pay more money in interest.

Another potential benefit of refinancing occurs if your credit score has improved in recent years. Interest rates on private student loans are determined based on your credit score. An improved credit score might equate to a lower interest rate during your refinancing.