Student Loan » Stafford Loans

Student Loans Help You Afford the High Price of College Tuition

admin — Sun, 04 Apr 2010 14:31:24 +0000

First, the interest will likely be far less than the interest of the market. Most students take out a Stafford loan because they do not require any form of credit that students should qualify for. Like the Perkins and Plus college loans, the Stafford college loans are subsidized, which means that while you are in school, the government will pay the interest of your student loan.

You might also need to get an unsubsidized loan or two. But the good news is that you do not have to pay it until you graduate and start making monthly payments off your loans.

Usually the interest rate on Stafford loans and most loans is low but it is an investment in your future which will likely benefit your lifetime salary. Another benefit of loans is that they also offer the benefit of offering flexible payment arrangements; you can even defer your loans for an extended period of time if you are trying to find employment.

To qualify for any of the federal programs, the student must enroll at least half-time in school and can be either a graduate or undergraduate student. The grade level of the student determines the amount of the loan during a given academic school year. Financial need is not necessary to qualify for federal student loan programs and Stafford loans in particular, can be paid back up to 30 years depending how much was originally borrowed.

Advantages and Disadvantages of Federal Student Loan Consolidation

Student loan consolidation is a process that allows students to combine all federal and private student loans and make one monthly payment. However it may not be an option for every college student approaching graduation day or a recent college graduate. Here’s some information about whether federal loan consolidation is right for you.

Bank lenders and consultants dissuade against consolidating private and federal loans together because the new consolidated loan will then be a private loan and you will therefore loose all the benefits that came with the federal loans, such as loan deferment if you decide to pursue graduate school.

So what are the pros and cons of federal student loan consolidation? This question depends partly on how much you owe, how much you’ve already paid, and other personal financial variables. Here is a brief overview:

Advantages of federal student loan consolidation

1. By consolidating your loans, you make one convenient payment that is also lower in amount. The federal interest rate is also likely to be lower than the combined interest of your original loans.

2. Borrowers can choose from four different payment plans, including an extended payment plan that can extend up to 30 years, depending on the amount that is owed.

3. Thankfully, there’s no fee for consolidating your government student loans and there’s no credit check when you consolidate your government student loans. 4.There’s also no penalty for paying the loan off early.

Disadvantages to Student Loan Consolidation

1. Taking an extended payment plan means paying more interest in the long run. Higher loans mean more interest.

2. The consolidated student loan rate might be higher than the interest rates on your other loans.

3. Consolidating your loans during the six month grace period after graduation results in loosing the remainder of the grace period.

4. Consolidation is not to your advantage if you’ve already paid off a large of your student loans.

5. Finally, check whether you end up forfeiting the special benefits that come with other federal student loans such as Plus and Perkins loan if you end up consolidating your federal student loans.

What College Students Need to Know about Stafford Loans

Student loans are one of the most popular methods used to help pay for college, but understanding how each one works is confusing. Like the Perkins and Plus Loans, Stafford loans are a type of federal loan program which can either be subsidized or unsubsidized. With a subsidized loan, the government will pay the interest that accrues while the student is in school while the interest with unsubsidized Stafford loans will accrue until the student pays the loan balance.

Depending on the type of Stafford loan, the student can borrow the money either from a bank or a credit union, or from the Department of Education. The interest rate for Stafford loans varies from each year, but is typically lower than the general consumer market, which of course is an important factor when paying back the loans.

How Do Stafford Loans Work?

In order for a student to qualify for Stafford loans the student must enroll at least half-time in school and can be either a graduate or undergraduate student. The grade level of the student determines the exact amount the student is permitted to borrow on the student loan. The amount subsidized is limited to a certain amount that is comparable to the total loan value the student borrowed that same year. Financial need is not necessary to qualify for Stafford loans and they may be paid back within twenty-five to thirty years, depending on the type of Stafford loan and the total amount that was borrowed. In certain circumstances students have various repayment options.

Student Loans Help You Afford the High Price of College Tuition

admin — Tue, 09 Feb 2010 15:49:25 +0000

You might also need to get an unsubsidized loan or two. But the good news is that you do not have to pay it until you graduate and start making monthly payments off your loans.

Advantages and Disadvantages of Federal Student Loan Consolidation

Advantages of federal student loan consolidation

1. By consolidating your loans, you make one convenient payment that is also lower in amount. The federal interest rate is also likely to be lower than the combined interest of your original loans.

2. Borrowers can choose from four different payment plans, including an extended payment plan that can extend up to 30 years, depending on the amount that is owed.

Disadvantages to Student Loan Consolidation

1. Taking an extended payment plan means paying more interest in the long run. Higher loans mean more interest.

2. The consolidated student loan rate might be higher than the interest rates on your other loans.

3. Consolidating your loans during the six month grace period after graduation results in loosing the remainder of the grace period.

4. Consolidation is not to your advantage if you’ve already paid off a large of your student loans.

5. Finally, check whether you end up forfeiting the special benefits that come with other federal student loans such as Plus and Perkins loan if you end up consolidating your federal student loans.

What College Students Need to Know about Stafford Loans

How Do Stafford Loans Work?

Deferment and Forbearance: When You’re Having Trouble Making your Student Loan Payments

admin — Tue, 29 Dec 2009 07:07:35 +0000

Whether you’ve only been out of college a few months and are still looking for a job, or you’ve just lost a job you had for the past five years, you may not always be fully financially equipped to handle your student loan debt. When unexpected expenses or hardships hit, even the most responsible borrowers can find themselves struggling to make their student loan payments.

But the good news is that your federal student loans come with repayment plans and deferment and forbearance benefits that could help you when you’re having trouble making your monthly payments.

To help you avoid getting caught in financial trouble with missed payments and defaulted student loans, NextStudent, a leading Phoenix-based education funding company, offers this quick guide to your deferment and forbearance benefits.

Postponing or Reducing Your Monthly Student Loan Payments

If you’re having trouble affording your monthly payments, don’t just ignore your monthly bills; always communicate with your lender about your financial situation and ask about your deferment and forbearance options. Deferments and forbearances allow you to temporarily postpone or reduce your monthly student loan payments while keeping your credit score intact.

Deferments and discretionary forbearances (granted in cases of financial hardship) aren’t automatic. You need to contact your lender to request a deferment or forbearance. You may be required to complete a deferment or forbearance request form and to submit supporting documentation.

Most federal student loans (including Perkins loans, Stafford loans, PLUS loans, Grad PLUS loans, and consolidation loans) come with deferment and forbearance benefits. Some private student loans may also offer deferment or forbearance periods—you’ll need to contact your private student loan lender.

Deferment

Deferment allows you to temporarily stop making payments on your student loans.

You may be able to request a deferment on your federal student loans if you are:

Enrolled in school at least half time

Unemployed

Experiencing economic hardship

In the military and have been deployed

When you’re in deferment, you’ll only be charged interest on your unsubsidized student loans. The interest on your deferred subsidized student loans will be paid by the government.

You can choose to make interest payments on your unsubsidized student loans during deferment in order to avoid having any accrued unpaid interest added to your principal student loan balance.

For your private student loans, contact your lender to see if they offer deferment periods under certain enrollment, military service, or financial circumstances.

Forbearance

Forbearance allows you to temporarily reduce or postpone payments on your student loans. You may request a discretionary forbearance in cases of unemployment or financial hardship. Generally, your lender can grant a forbearance for up to a year at a time.

When you’re in forbearance, you’re responsible for all interest that accrues, whether the student loans in forbearance are subsidized or unsubsidized. You can choose to make interest payments during forbearance in order to avoid having any accrued unpaid interest added to your principal loan balance.

Avoiding Default

Just like making on-time car or credit card payments, timely student loan repayment can be a way for you to build credit or improve your credit score. At the same time, every student loan payment you miss can bring down your credit score. Miss enough payments, and your student loans could go into default, which can cause damage to your credit that takes years to repair.

The key to avoiding default is communicating with your lenders about your financial situation and requesting a deferment or forbearance if you need one. More likely than not, your lenders are going to be willing to work with you to help keep you from defaulting by keeping your student loan repayment affordable, even when you’re facing tough financial circumstances.

NextStudent believes that getting an education is the best investment you can make, and we’re dedicated to helping you pursue your education dreams by making college funding simple. Learn more about Student Loans, Private Student Loans and Student Loan Consolidation at NextStudent.com.

By: Jeff Mictabor

Bad Credit Student Loan

admin — Sun, 27 Dec 2009 10:36:56 +0000

Want to study more and money is the hitch, then no need to worry. Your problem is now has a solution. Bad credit student loan gives a student the opportunity to study unlimited. Student loan with bad credit, finances your studies. Bad credit student loan acts as a bridge to your school, or college. Student loan is available with interesting rates of interest. Various institutions like US department of education loan grant student loan with exciting rates of return. Moreover these have fewer formalities as compared with other types of loan.

A student can pay the loan amount in easy installment even after completing the studies. Student loan with bad credit lessens the burden of the parents. Now a student can carry on with his/her studies according to their wish. There are many institutions that prefer to give student loan with easy installments. The most attracting feature of student loan with bad credit is about the repayment of the loan. You have to make repayment of the loan only after completing your studies.

A student can now study by paying his/her fee or extra expenditure himself or herself by taking student loan with bed credit. Every student prefer to finance his or her study by own. Federal loans are the best source of taking student loan. Beware of other private institutions granting loans. Make sure that you have gathered all necessary information about the institution you are taking loan. No need to worry about the installments of the loan. It’s your wish how to pay the loan amount. There are generally two types of student loan – Secured and unsecured.

The difference between these loans is of the rate of return. Secured loans generally have the high rate of interest as compared with the unsecured loans. US department education loans, Stafford loans are among the best institutions granting student loan with bad credit. Every student is eligible for applying for the student loan whether he or she a graduate or under graduate. From the high school stage a student can apply for the loan till he finishes his or her study. Plus loans are the loans for parents. And only parents can repay the loan amount. It’s simply a student wish to avail bad credit student loan. Moreover student loan is available with affordable rate of interest. Time is no more a problem. It simply means that time limit is no problem. The time period of student loan is according to the wish of the student.

Student loan with bad credit is the best option for a child dreaming of going to school or college but can’t afford to. So shun away your worries regarding the expenditure of the going to college etc. and avail the benefits of student loan. A systematic procedure is followed for applying for student loan. Student loan is very much in demand so study by paying your fees and other expenses. Student loan with bad credit is only foe students. The role of parents is only to guide their children’s and help them out. As the repayment is done after completion of studies so you get enough of time to repay the amount and moreover the installment system enables you to concentrate on your studies.

By: Bruno Auger

Student Loan Consolidation May Get you Up to 20 More Years to Pay Off your Student Loans

admin — Fri, 25 Dec 2009 09:01:46 +0000

If you’re a former student or a college parent with any outstanding federal student loans, you may be able to get up to 20 more years to repay just by consolidating your eligible federal parent or student loans. With that longer repayment term, since you have more time to repay, the amount you have to pay each month will typically go down. You may be able to cut your monthly student loan payments by up to 42% — just by consolidating!

Cut Your Payments on Your Student Loans by up to 42%

Here’s an example of how you can lower your monthly student loan payments when you consolidate your federal college loans and take advantage of a longer repayment term: Estimated monthly payments on a $75,000 student loan consolidation fixed at 7.25% and repaid over an extended term of 30 years are $512, versus estimated monthly payments of $879 on a $75,000 Federal Stafford Loan issued at 7.22% and repaid over 10 years — that’s a 41.8% reduction in monthly payment amount. (Your actual payment reduction may vary and will depend on the terms of the parent or student loans you’re consolidating.)

Get More Time to Repay Your Student Loans

Federal PLUS parent loans and Stafford student loans are issued with standard repayment terms of 10 years. You may be able to get up to 30 years to repay these federal parent and student loans when you consolidate them into a student loan consolidation.

How long you get to repay will depend on the total outstanding balance of your education debt: If your outstanding education debt totals $20,000 – $39,999, you’ll have 20 years to pay back your student loan consolidation.? If your outstanding education debt totals $40,000 – $59,999, you’ll have 25 years. If you have $60,000 or more in education debt when you consolidate your federal student loans, you’ll have 30 years to pay back your Federal student loan consolidation.

No Fees. No Credit Checks. No Prepayment Penalties.

Even though you can get more time to repay your federal parent and student loans by consolidating, there are no prepayment penalties on a Federal Consolidation Loan, so you won’t be assessed any additional fees for paying more than the minimum each month or for paying off your student loan consolidation early, should you choose to.

There are also no application fees, no processing fees, and no credit checks when you consolidate through the federal student loan consolidation program.

Replace Your Variable-Rate Student Loans With a Fixed-Rate Consolidation Loan

If you took out your Federal PLUS Loans or Stafford Loans prior to July 1, 2006, those loans are subject to variable interest rates that will adjust every year. So when interest rates rise, your monthly student loan payments may also go up. But you can put an end to rate increases and rising payments when you consolidate your parent or student loans.

The federal student loan consolidation program gives you the security of a fixed interest rate. By consolidating your federal

student loans, you’ll replace your variable-rate college loans with a fixed-rate consolidation loan, so you won’t have to worry about interest rates rising and leaving you guessing about your monthly payment amount.

Make Just One Payment for All Your Federal Student Loans

If you have multiple student loans in repayment and you’re dealing with the hassle of multiple bills, multiple due dates, and multiple monthly payments to multiple lenders, a Federal Consolidation Loan could help make your student loan repayment easier to manage.

With the federal student loan consolidation program, you can bundle all your eligible federal parent or student loans into one single consolidation loan with just one monthly bill, one lender, and one monthly payment that’s fixed for the life of your consolidation loan.

Consolidate Your Private Student Loans

If you have private student loans in addition to your federal student loans, you won’t be able to consolidate your private student loans under the federal student loan consolidation program. But you may be able to consolidate your private student loans separately with a Private Consolidation Loan, which offers the same convenience of a single consolidated loan for your private student loans.

By: Jeff Mictabor

Student Loan Consolidation: Replace your Variable-rate Student Loans With One Fixed-rate Loan

admin — Sun, 20 Dec 2009 20:53:49 +0000

If you’re a parent or ex-student who took out any Federal PLUS Loans or Stafford Loans prior to July 1, 2006, those student loans are subject to variable interest rates that will adjust every year. When interest rates rise, your monthly student loan payments may also go up. If you’re on a tight budget, higher monthly payments may prove difficult to manage. Do you wish, instead, you could have a set monthly payment for your federal student loans that you know would never change? Student loan consolidation may be for you.

Federal student loan consolidation gives you the security of a fixed interest rate. By consolidating your federal parent student loans, you’ll replace your variable-rate college loans with a fixed-rate consolidation loan, so you’ll never have to worry about interest rates rising and leaving you guessing about your monthly payment amount.

Take the Hassle Out of Repaying Your Student Loans

If you have multiple college loans in repayment and you’re juggling multiple bills, multiple due dates, and multiple monthly payments to multiple lenders, a student loan consolidation could help make your repayment easier to manage. With a student loan consolidation program, you can bundle all your eligible federal parent or student loans into one single consolidation loan with just one monthly bill and one monthly payment that’s fixed for the life of your college loan.

Cut Monthly Payments on Your Student Loans by up to 40%

Besides offering you convenience and the security of a fixed interest rate, a student loan consolidation could also help you cut your monthly student loan payments almost in half. When you consolidate your college loans, you may be able to extend the repayment term on your parent or student loans by up to 20 years. With that longer repayment term, since you have more time to repay, the amount you have to pay each month will typically go down. By consolidating your college loans, your monthly payments could go down by up to 40%!

Apply in Minutes to Consolidate Your Student Loans

You can apply for your student loan consolidation in minutes, either online or with a quick phone call to NextStudent. It’s fast, easy, and free to apply, and there are NO fees, NO credit checks, and NO co-signers required.

There are also no prepayment penalties on your Federal Consolidation Loan. When you consolidate your student loans with NextStudent, you’ll never be charged extra for paying more than the minimum each month or for paying off your student loan consolidation early.

Who’s Eligible for Student Loan Consolidation?

To be eligible to consolidate your own federal student loans, you can’t currently be enrolled in school more than half time. The student loans you’re looking to consolidate must be in repayment, in a grace period, or in an authorized deferment or forbearance period.

Your parents can consolidate the PLUS loans they took out to help you pay for school as soon as those student loans have been fully disbursed and have entered repayment, even if you’re still in school full time. Although your parents can consolidate their PLUS loans, you won’t be able to consolidate your own college loans with your parents’ loans.

Student Loan Consolidation for Private Student Loans

If you have private student loans in addition to (or instead of) your federal student loans, you won’t be able to consolidate your private student loans under the federal student loan consolidation program. But you may be eligible to consolidate your private student loans separately with a Private Consolidation Loan, which offers the same convenience of a single consolidated loan for your private student loans.

NextStudent believes that getting an education is the best investment you can make, and we’re dedicated to helping you pursue your education dreams by making college funding simple. Learn more about Student Loans, Private Student Loans and Student Loan Consolidation at NextStudent.com.

By: Jeff Mictabor

Student Loans Come in a Variety of Types and Payment Schedules

admin — Sun, 20 Dec 2009 12:45:53 +0000

There are a number of different types of student loans. They are all created to help students and parents discover the right choice for their respective situation. The overall cost of both private and public colleges are steadily increasing and students need to find the means for funding their education. Deciding which student loan, whether a private or federal student loan, is a very important decision. You will eventually be responsible for paying it back, so research all of your options. &nbsp

What is a Student Loan?

If you are a student who is preparing to borrow money as part of a student loan, prepare to learn all that you can about what a student loan is and why you need it. It is meant to help you as you pursue your collegiate education. Because the cost of education is continually rising, student loans give you more opportunity to go to the school of your choice. Be prepared to begin repaying of the loan a short time after you have finished your education. &nbsp

Types of Student Loans

There are three primary types of student loans available, a federal student loan, a private student loan or a parent loan. Two of the most common federal loans used by students are Stafford loans and Perkins loans. What is beneficial behind a federal student loan is that federal laws regulate the interest rates charged for these programs. A lender has to offer a federal loan at the specified interest rate, which is usually lower than the national interest rate. A federal student loan can also be consolidated after the student graduates, allowing the student loan repayment plan to fall under one large umbrella.

Private student loans are different from federal loans, and students applying for these don’t have to fill out federal forms. Private lenders offer these loans, making them cost more because there is no legal requirement to stay within a certain interest rate. Private loans also require a student to submit their credit history, and the interest and fees paid on the student loans are based upon the student’s credit score. Parents may be required to co-sign for a private student loan, making them responsible if the student has to defer payments at any time.

A parent loan, or the Parent Loan for Undergraduate Students (PLUS), is a type of student loan parents apply for to encompass any additional cost their child’s financial aid or student loans won’t cover. PLUS loans, like other federal loans, come with a fixed interest rate. These loans can also be consolidated, like the Stafford and Perkins loans, and parents are fully responsible for repaying PLUS loans to the lender after they are distributed.

Finding student loans that are right for you doesn’t have to be a difficult task. It just takes a little time and research before making a final decision. Talking with your college’s financial advisor can help you go down the right path when choosing a loan. It is important to go over all the student loan repayment options when choosing a loan program from a lender because you will be financially responsible after graduation. Deciding upon the right loan can help you achieve your dreams of higher education.

By: Samantha Ellis

Student Loans: Cut Monthly Payments on your Student Loans by Up to 42%

admin — Sun, 13 Dec 2009 14:09:46 +0000

If you’re a graduate or college parent with any outstanding federal student loans, you may be able to lower your monthly student loan payments by up to 42% just by consolidating your parent or student loans. When you consolidate your college loans, you may be able to extend the repayment term on your parent or student loans by up to 20 years. With that longer repayment term, since you have more time to repay, the amount you have to pay each month will typically go down.

NextStudent, a leading Phoenix-based education funding company, offers a student loan consolidation program with no application fees, no processing fees, and no credit checks. By consolidating your parent or student loans, your monthly payments could go down by up to 42%.

Here’s an example: Estimated monthly payments on a $75,000 NextStudent Federal Consolidation Loan fixed at 7.25% and repaid over an extended term of 30 years are $512, versus estimated monthly payments of $879 on a $75,000 Federal Stafford Loan issued at 7.22% and repaid over 10 years — a 41.8% reduction in monthly payment amount. (Your actual payment reduction may vary and will depend on the terms of the student loans you’re consolidating.)

Replace Your Variable-Rate Student Loans With One Fixed-Rate Student Loan Consolidation

If you took out your Federal PLUS Loans or Stafford Loans prior to July 1, 2006, those student loans are subject to variable interest rates that will adjust every year. So when interest rates rise, your monthly student loan payments may also go up. Student loan consolidation puts an end to rate increases and rising payments.

NextStudent’s student loan consolidation program gives you the security of a fixed interest rate. By consolidating your federal college loans with NextStudent, you’ll replace your variable-rate college loans with a fixed-rate student loan consolidation loan and lock in your new monthly payments, so you’ll never have to worry about interest rates rising and leaving you guessing about your monthly payment amount.

Make Repaying Your Student Loans Convenient and Hassle-Free with Student Loan Consolidation

If you have multiple college loans in repayment and you’re dealing with the hassle of multiple bills, multiple due dates, and multiple monthly payments to multiple lenders, a student loan consolidation could help make your repayment easier to manage.

With a student loan consolidation program, you can bundle all your eligible federal parent or student loans into one single consolidation loan with just one monthly bill, one lender, and one monthly payment that’s fixed for the life of your student loan consolidation.

Apply in Minutes to Consolidate Your Student Loans

Typically, you can apply for a student loan consolidation in minutes. Just visit an online student loan consolidation lender or make a quick phone call to the lender of your choice. It’s fast, easy, and free to apply, and there are NO fees, NO credit checks, and NO co-signers required.

There are also no prepayment penalties. When you consolidate your federal parent or student loans with NextStudent, you’ll never be charged extra for paying more than the minimum each month or for paying off your student loan consolidation early.

Student Loan Consolidation for Private Student Loans

If you have private student loans in addition to (or instead of) your federal student loans, you won’t be able to consolidate your private student loans under the federal student loan consolidation program. But you may be eligible to consolidate your private loans separately with a Private Consolidation Loan, which offers the same convenience of a single consolidated loan for your private student loans.

NextStudent believes that getting an education is the best investment you can make, and we’re dedicated to helping you pursue your education dreams by making college funding simple. Learn more about Student Loans, Private Student Loans and Student Loan Consolidation at NextStudent.com.

By: Jeff Mictabor

Having Trouble With your Student Loan Payments? Look Into your Deferment and Forbearance Options

admin — Fri, 11 Dec 2009 05:34:29 +0000

If you just graduated in May with federal Stafford student loans, you may be having to adjust your monthly budget to accommodate new student loan payments as your Stafford six-month grace periods end sometime this month. If you’re still looking for a job, or if you’re at an entry-level salary right now, you may not have the money you’re going to need to meet a new monthly student loan expense.

Whether you’re a recent graduate or any parent or student loan borrower, if you’re having trouble meeting your student loan payments each month, NextStudent, a leading Phoenix-based education funding company, urges you to contact your lenders about your deferment and forbearance options. Deferment and forbearance periods can allow you to temporarily reduce or postpone the monthly payments on your student loans without putting yourself at risk for damaging your credit score or defaulting on you student loans.

What are deferment and forbearance benefits?

Deferment allows you to temporarily stop making payments on your student loans. If you’re unemployed or experiencing financial hardship, you may be able to request a deferment, for up to a year at a time, up to a total of three years over the life of the student loan. You must contact your lender to request an unemployment or hardship deferment, and you may need to fill out a deferment request form.

Forbearance allows you to temporarily reduce or postpone payments on your student loans. You may be able to request a forbearance if you’re unemployed or experiencing financial hardship. You must contact your lender to request a hardship forbearance, and you’ll typically need to complete a forbearance request form. You may also need to submit supporting documentation.

Generally, a lender can grant a forbearance for up to a year at a time. Unlike unemployment or hardship deferments, there is no three-year cumulative limit on discretionary forbearance periods granted due to financial hardship.

Which student loans are eligible for deferment and forbearance?

Most federal student loans Student Loan Consolidation, Stafford loans, PLUS loans, and Grad PLUS loans) are eligible for deferment and forbearance benefits.

Some private student loans may also offer deferment or forbearance benefits—you should contact your private student loan lender.

Keep in mind that if you’re considering an economic hardship deferment or forbearance, you need to contact your lender, even for your federal student loans. Hardship deferments and discretionary forbearances are generally not automatic.

Am I being charged interest while my student loans are in deferment or forbearance?

Yes. Interest charges continue to accrue on your student loans even if they’re in deferment or forbearance. You’ll be responsible for the interest on your unsubsidized student loans (such as unsubsidized Stafford loans) that are in deferment and on any of your student loans, whether subsidized or unsubsidized, that are in forbearance. The government will pay the interest on any of your subsidized student loans (such as Perkins or subsidized Stafford loans) that you have in deferment.

Any unpaid interest that accrues during a deferment or forbearance period will be capitalized and added to your principal student loan balance for you to repay once you go back into repayment. Even if your payments are postponed during a deferment or forbearance period, you can always choose to make interest payments to avoid having accrued interest added to your principal student loan balance and capitalized.

NextStudent believes that getting an education is the best investment you can make, and we’re dedicated to helping you pursue your education dreams by making college funding simple. Learn more about Student Loans, Private Student Loans and Student Loan Consolidation at NextStudent.com.

By: Jeff Mictabor

Finding Student Loans To Fund Your College Education

admin — Wed, 09 Dec 2009 10:55:46 +0000

A student who is awarded one of the direct student loans needs to be attending a school that participates in the Direct Loan Program.

That student must first complete a FAFSA, and then he or she must sign a master promissory note (MPN). If the loan recipient then needs to talk with a counselor about the loan, those services can be obtained at the Direct Loan Servicing Site.

Services Available to Holders of the Direct Student Loans

At the Direct Servicing site, the holder of a direct loan can set-up an account. Using that account the holder of a direct student loan can view the record of his or her payments.

That site also contains records on the balance owing for each of the many student loans.

Anyone who has been awarded one of the direct student loans can use the Service Center to request use of electronic correspondence for the sending of bills and other information. Loan payments can be made free of charge from the Service Site.

Payments for any of the student loans can be scheduled as much as 6 months ahead of time.

The Various Types of Direct Student Loans

Some students with a direct loan have a subsidized Stafford Loan. The subsidized loan has an interest subsidy. All students awarded those direct loans can count on the government to cover their interest payments while they are still in school..

Not all Stafford Loans are student loans, and not all direct student loans are subsidized. Where students do not show tremendous need, the government might award an unsubsidized Stafford Loan.

Such unsubsidized loans do not come with an interest subsidy.

PLUS Loans represent a third type of direct student loan. PLUS loans are low interest loans for graduate students and parents. As with the other student loans, the application for the PLUS Loans entails submission of a FAFSA and a MPN.

Factors That Determine the Size of the Direct Student Loans

Not every student who receives one of the direct student loans gets the same amount of money. The amount of money awarded to the recipient of a student loan depends on three different factors.

The school costs will dictate to a large extent the size of the student loan. The government will also adjust its loan amount to account for any other aid that a student might expect to receive.

Finally, the distribution of funds for the direct student loans depends on the expected contributions from each student’s family.

After the Department of Education has examined those three factors, then it will provide a needy student with funds that should adequately cover his or her tuition costs.

Most students can get-by with loans of $8,000; they then obtain added money from additional on and off-campus sources.

By: Martin Haworth