Financing College – Private Student Loans, Federal Student
As you are aware there can be several types of student loan consolidation for you. Broadly however there can be two categories. These are Federal Student Loan Consolidation Plan and Private Student Loan Consolidation plan for you. Consolidation is made applicable to both types of loans.
Stafford loans, private and federal, subsidized or not are prime subjects for such student loan consolidation. You can also consolidate the HEAL, HPSL and Parent PLUS loans availed. The PLUS loan includes the federal direct loans, consolidation loans, and direct loans. Other loans that could be consolidated are Perkins Loans and Nursing Schools Loans.
About the federal and private loan consolidation processes
Federal loans as well as the direct consolidated loans cannot be consolidated once again without obtaining or including additional loans. If you have already effected the student loan consolidation in respect of your undergraduate loans you can also add the graduation loans at later dates. Since these are additional loans such loan consolidation shall be permissible.
You may also like to consolidate the private loans you had obtained as student. Never ever try to consolidate federal with private loans that results in private consolidated student loans. Such consolidation will deprive you of many benefits you could obtain with federal loan consolidation process.
Drawbacks of consolidating federal with private loans
Several drawbacks occur when you try to consolidate federal loans with the private loans. Some of them are –
• With federal loan consolidation you can defer payments if you wish to resume your academic career. No such facilities are available under private loan consolidation plans.
• Forbearance despite all economic hardship is not possible in case of private loan consolidation though permissible in case of federal loan consolidation.
• No income tax deductions as in case of the federal loan consolidation interests are available in private consolidation plans.
• You have chances to be forgiven in case of federal loan consolidation that is not permissible under private loan consolidation plans.
• Like federal loan consolidation the military services, working as trainer in the economic development zones etc may not render you for any relaxation under private plans.
• Private loans do not die a natural death in case of your untimely demise. Your heirs and successors in interests would be responsible for repayment.
• Private loan consolidation rates are variable while the federal loan rates are firm and often better.
Federal student loan consolidation should be your first priority
If you are going for college loan consolidation your best bet would be to consolidate your federal loans first. The federal loan consolidation carries the best student loan consolidation rate and will be highly beneficial in financial terms compared to the private loan consolidations. Once you carry out your federal loan consolidation successfully it will boost your credit rating. In result you will become eligible for much better terms and conditions going for the private loan consolidation at a later stage.
Watch the video related to College Loans Consolidation
Financing College – Private Student Loans, Federal Student With a good private student loan, tuition fees are not the only thing covered. There are also loan packages which can cover the additional expenses in college education. Let’s face it. Such expenses can lead to a substantial amount…
Help answer the question about College Loans Consolidation
College Student With Credit Card DEBT?I am currently a junior in college and I desperately used credit cards to pay off college since financial aid didn't cover it all so now I owe around 4,000 in debt. What is the best thing for me to do, since all of the accounts are closed, is there a college student credit card debt consolidation loan or?
About Author
Albert William has been an expert in the field of college loan consolidation for long. Presently he is the professor of economics in a leading American University and is also one of the exponents on the leading American Channel on best student loan consolidation rates.
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Most of the lenders you listed are all long time viable student loan lenders; however, right now in the economic situation we find ourselves in there is no such thing as a secure education loan lender. Many of them are either withdrawing from the Federal or Private loan programs. MEFA for instance is either not doing federal, or not doing private loans. There have been so many changes it is hard to keep track of them.
For a good read and information about the leading lenders out there check out this link to finaid.org: http://www.finaid.org/loans/lenderlayoffs.phtml
They have a quality up to date list with who is still in the business.
I agree with Found-1 that you should probably start an excel sheet to track each lenders product and what is available. Here is the list of questions I would ask them about their product to track by comparison:
Interest rate (these are always variable and based on the economy)
Min & Max amounts you can borrow per year
Aggregate amount you can borrow
Grace period after graduation (how many months)
Origination fees
Repayment fees
Repayment benefits such as deferment/forbearance if you should get into trouble financially – what will they do for you.
Can it be deferred again when entering grad school?
Repayment Period (how many years to repay loan)
This was just a quick list off the top of my head that you should be knowledgeable about before taking a loan from a company. Putting them into a spreadsheet will give you an easy way to compare the loans that meet the criteria that best suit you.
Hope this helps.
Alright, let's see if we can get you some answers.
First and foremost, make sure that your existing loans don't fall into default. Being late and being in default are not the same thing – you're 'technically' in default when your loans are past due, but you're not officially 'in default' until your lender notifies you that you have reached that point. Beg, borrow or steal to prevent yourself from reaching that point, because that's going to limit your options.
You didn't indicate what type of loan you had before. You said that you're not real savvy about financial aid, and you make it sound like you haven't applied for federal aid in the past. Does that mean that your current loans are private loans?
If they are private loans, pull out the promissory note that you signed when you were approved for the loan. You're looking, specifically, for information about an "in-school deferment". You may find it there, you may not. The Stafford loan (which is a federal loan) has an in-school deferment feature. In school deferment means that your payment obligation is temporarily suspended, as long as you are actively registered for, and attending school. If you're going back to school, you'll want to know if this will freeze your repayment obligation.
You are correct about government loans – you can and will qualify for a Stafford loan UNLESS you have previous Stafford or Perkins loans that are already in default. If you do have a previous Stafford or Perkins in default, you will not be eligible for ANY forms of federal student aid. You will also not be eligible for assistance from the federal student aid program if you owe your previous school any more for financial aid "overpayments". If your old school is dunning you for money, that's the situation that you are in.
First figure out what kind of loans you owe. Then determine whether they're actually in default, or just several months past due. Call your lender – it's scary to speak to people you owe money to, but they won't bite, and you're going to have to work with them.
If you're eligible, complete the Free Application for Federal Student Aid. Like it or not, you're going to need to provide information about your parents' finances, even if they have no intention of helping you pay for school. If you're not sure if you're eligible, complete it anyway – the Department of Education will let you know if you're not eligible for aid, because they're going to review your entire financial aid history using the National Student Loan Data System. If you're curious what they're going to find there, you can review that info, too. Just go here: http://www.nslds.ed.gov/nslds_SA/
There's another issue, that we haven't even touched on yet – this one also goes back to your unsuccessful first go-around at school. If your school placed you on financial aid probation, and then financial aid suspension, you are currently ineligible for more aid – even if you switch to a new school. If that's the case, you may be required to spend a few semesters improving your grade point average, before you'll be eligible for financial aid again.
Assuming that your loan problems or a financial aid suspension will not prevent you from applying for federal student aid, you WILL be offered the opportunity to borrow from the Stafford loan program. You'll be offered as much as $5500 a year. You won't need a cosigner, and you won't even need to answer questions about those other loans.
To be very honest with you – I'd recommend that you gather up your paperwork, and make an appointment with an aid officer at the community college that you're hoping to attend. If you tell them the full – and even the embarrassing details of your educational and financial aid history, they'll be able to give you some good advice on what you might be eligible for now – and what you might need to do to make yourself eligible for more. You're also going to have to get on the phone with your lender – avoiding a lender has never once been a successful strategy for anyone, no matter how less stressful it seems at the time.
I wish you the very best of luck in getting yourself turned around. I bet you can do it, if you're really determined.
Edit: You're still okay, but you're going to have to contact your old school and negotiate a payment agreement. Once you've reached an agreement, and begun making payments, you'll be eligible for more federal student aid again.
I wouldn't pay for a CFP its just gonna cost you more. Have you done FASFA? age don't matter its all about the income. I can help more let me know about FASFA. All colleges have advisors and I dont think they help I had to do it on my owe and I help six others let me know what you need I am pretty good at this.
do your own homework, use Wikipedia.com that should help, or better yet, take notes in class and look over them
Since you are a Realistic person, then it probably isn't much of a stretch for you to realize you can not afford a private out of state school at this time in your life. I'm not saying you will never get there, just not right now.
Because unfortunately, you can't get a private student loan without a cosigner. Period. Most community colleges will put the admission application fee in with your tuition so your financial aid will pay for it. If that isn't something they will do, contact the schools admission office and ask if they can waive the fee. You might consider asking a school counselor, church leader, a freind's Mom who DID go to college to call on your behalf and see if that will help convince them to waive the admission fee. I have done this several times for students and never been told no!!!
Local state schools and community colleges are VERY affordable and I'm sure you can find more than one you can attend for well under the federal loan limits. If your parents apply for a federal parent PLUS loan and get denied you are eligible to borrow a few thousand dollars more than the 5,500 a year as a dependent freshman.
Read this book cover to cover. It will help you in the student loan info. If you have any more questions please feel free to ask.
It's good you’re looking at your options. There are some pros and cons of the various lenders.
(full disclosure I work for one of them Student Aid Lending)
First understand that the rates and programs are virtually all the same. The Dept. of Education came up and administers the consolidation program so the rate/payment/etc. are all the same from one lender to the next as they do not decide what your rate is the Dept. of Education does.
Secondly you can not (and should not) combine your private and federal loans into one consolidation. If you do so you'll loose all the benefits (deferment, tax deductions, ect.) that come with your federal loans. In fact I wouldn't be in a rush to consolidate your private loans. Since many students have begun taking out private loans new programs are coming out late summer to offer you better rates and discounts on these loans so it would be good to wait till at least July.
So what's up with the 1.85% off – Cash Back – 2% discount after 24 months???
Lenders are competing for your business by offering other bennies. All make good on their offers but all of them will offer you the same benefits, all offer cash back or rate discounts or both. The question is do you have to ask for them or do they just offer them to you. Understand one benefit may be better than another. What's more important to you, cash today or paying less interest money and lower payments for the life of the loan?
Here's the break down
Cash Back = Money Today
Rate Discount = Less % Spent
Cash Back & Rate Discount = A little of each
Pick a lender you feel comfortable with. Someone you can call when you have a question and who you know will manage your account best.
Remember they are all truly the same the question comes down to service.
Good Luck.
Part 668 of Title 34 of the Code of Federal Regulations (CFR) provides the statutes that govern the federal aid system.
The relevant part of 668.32 says:
A student is eligible to receive title IV, HEA program assistance if
the student–
(h) Files a Statement of Educational Purpose in accordance with the instructions of the Secretary;
When you apply for financial aid, you will be asked to sign that Statement of Educational Purpose, and it will say something like this:
"Statement of Educational Purpose and Certification
I hereby affirm that any funds received under Federal Work Study, Federal Perkins Loan, or Federal Direct Loan Program will be used solely for expenses related to attendance or continued attendance at _______ University. I further understand that I am responsible for repayment of a pro-rated amount of any portion of payments made which cannot reasonably be attributed to meeting educational expenses related to the attendance at this institution. The amount of such repayment is to be determined on the basis of criteria set forth by the Secretary of Education.
By financial aid law, you are permitted to use federal student aid to cover the "Cost of Attendance" at your school. Cost of attendance specifically includes:
Tuition and fees
An allowance for books, supplies. transportation and miscellaneous personal expenses
An allowance for room and board
For students with dependents, an allowance for costs expected to be incurred for dependent care.
Obviously, the most relevant allowance is for transportation, but I can tell you that the transportation allowance is an allowance for gas and minor maintenance of a vehicle, and not for the purchase of a vehicle. Most schools estimate the transportation allowance as something in the neighborhood of $800-1200.
So here's the deal….
Under a strict interpretation of the federal aid rules, you can not use student aid to purchase a vehicle. However, there are few caveats:
The government does not require that you provide an accounting of your expenses. They're going to take your word for it (and you did sign an affidavit to this effect) that you will use the money only for educational purpose.
Remember – your financial aid is based on your school's estimate of what it should cost you to attend each year. Obviously, that amount differs from student to student, so the school uses a profile for an "average" student – your actual expenses may be less than the school allows.
Still, this makes me wonder how your school could have so badly over-estimated the amount of money you would need to pay all of your school expenses this year.
Finally, be careful in analyzing the financial case for using a student loan to buy a car. The car loan may have a higher interest rate, but the car loan isn't a 10-year loan, like those Staffords that you're thinking about using. The longer the term of the loan, the more interest accrues on the loan, and the more you will eventually have to repay. An interest rate difference of a few points could easily be wiped out by a longer loan term.
Never use a loan to buy an item that has a useful life shorter than the repayment term of the loan. You wouldn't want to be making monthly payments on a TV that you threw away years ago, and you don't want to be making payments on a car that's sitting in someone else's driveway, or rusting in a junkyard. It's highly unlikely that you'll be driving that "slightly used car" in 10 years, when you're done paying off the loans that you used to buy it.
Can you get away with it? Almost certainly. You're worrying too much if you think the Department of Education analyzes your spending when they use your annual FAFSA to calculate each year's EFC score (they don't).
Do you really have THAT much money left over? If you do, your school is wildly inaccurate in their Cost of Attendance calculation and analysis.
Should you buy a car with that money?
From a financial perspective, absolutely not.
From an "I can't get to school if I don't have a reliable car and this is my only option" perspective? You'll have to decide that for yourself.
From an "Is this pretty boldly stretching the rules of the aid system?" perspective. Yes it is.
From a "Can I get away with it?" perspective – yes, you can.
Good luck.
First of all you shoud be called a great BIG conservative. To be an American you should have respect for the Constitution and what it stands for. The current admin does not even recognize to Constitution. Mr. Bush considers it "A god damn piece of paper" Cheney cannot even remember that the military oath is to defend the Constitution. (His memory failed during a prepared speech to West Point graduates)
At the end of your dissertation you requote Mr Bush as stating he he stands firm for non-negotiable demands of human dignity.
So far during his watch:
Rescue workers at ground zero were lied to regarding their health.
Habeus Corpis was revoked after 200 years
Torture was instituted (including children)
Americans have had their phone conversations eaves dropped upon.
The public has been lied to regarding war.
Thousand of American soldiers have died
Hundred of thousands of Iraqi citizens have been murdered.
The deficit is at 3 Trillion dollars and the American dollar may collapse because of the debt.
Gas prices have risen dramatically and that is not due to the price of oil. The refineries are not working at capacitiy and the oil companies ( this admin. is a part of) have raked in record profits.
The middle class has eroded. Americans are now putting living expenses on their credit card.
The government has not been held accoutable to the people.
Women are certainly not respected when the ban on late-term abortions did not include emergencies concerning the life of the mother.
Religion is only tolerated if you believe in the approved God.
Property Rights are not respected when you consider "eminant domain"
Freedom of speech is only "free" when you agree with the policies of the admin. (or if your FOX noise)
There is NO equal justice since this current regime has taken power and eroded our civil rights. The same rights that we are supposedly defending with the war on terror.
The USA has not signed the Kyoto accords.
The USA has NEVER signed any UN resolutions regarding human rights.
The USA does not belong to the International Court so none of our leaders can be tried for human rights violations or crimes against humanity.
Stop listening to the propaganda and do some independent research before you regurgitate the "official line".
This president may think he has principles but he certainly does not abide by them. The sheep that are following are fellow Republicans (congress) and certainly NOT liberals!!!
So whose idea of "right" are you speaking of?