Posted by
. :~ ShAh G . :~
at
3:51 PM
. :~ ALIVE FUN ARTICALS ~: .
Although many people have achieved the dream of completing their college education, many of them face an unfortunate downside following graduation: paying back the inevitable student loan.
Too often it is not just one loan looming over students, many of whom have yet to settle into the sometimes overwhelming realities of the workforce and daily life.
NextStudent, one of the nation's premier education funding companies, can be the proverbial light at the end of the tunnel by helping students consolidate their multiple federal loans. From Stafford Loans and Perkins Loans to PLUS Loans and HPSL Loans, NextStudent's Federal Student Loan Consolidation Program equals convenience.
"Although the 2.77 percent interest rate on federal loans was at an all-time low between July 1, 2004 and July 1, 2005, the lowest the rates ever had hit in history, now is still a good time to consolidate," said Andrew Ernstrom, education finance adviser at Phoenix-based NextStudent.
Currently the interest rate is in the 5 percent range and is expected to again increase in July 2006. The cap on the program is 8.25 percent, but projections for the next increase are between one or two points.
"Everyone knew the rates were going up about 2 percent this past July 1," Ernstrom said. "So there was a mad dash nationwide to get everyone's loans consolidated," which allowed borrowers to take their variable rate loans and then lock them into a fixed rate.
Historically during the past 40 years interest rates averaged closer to 7 percent.
An important aspect of consolidation includes the six-month grace period. "Make sure to consolidate while you're in the six-month grace period because you get a cheaper interest rate," he said. The rate increases .6 percent when the grace period ends.
Students have been gung-ho about federal loan consolidation. "The only reason people wouldn't consolidate is because they don't think the rates will go up, but all the trends out there say they will, so it makes sense to do it now," Ernstrom said. The interest rates for student loans are set up off of the 91-day Treasury bill. Since May 30 when the rate was reset, the rate increased about .92 percent. "If the rates were reset today, everyone's rates would be .92 percent higher. And by next July who knows how high it could go," he said.
NextStudent's Federal Student Loan Consolidation Program extends loan payments up to 30 years, depending on a borrower's balance. As many people originally take out loans on a 10-year repayment plan, consolidation offers the same interest rate on the same amount of money but at a longer term, making the payment much more affordable. There are no prepayment penalties for the program, so borrowers can pay off loans at their own pace and have the benefit of a longer term if needed. Consolidation can decrease some payments up to 60 percent.
Even if students already have consolidated, NextStudent can help further lower their interest rate with reconsolidation, which allows borrowers to reset their forbearance and deferment rights, take advantage of new industry discounts and also can lower their payment.
"In the past students who had consolidated did not have the opportunity to consolidate again unless they took out new student loans," said Katie Carpenter, education finance manager at NextStudent. "In the past few months the Department of Education has allowed all previously consolidated loans to be reconsolidated," she added.
In turn, consolidation is the answer not only for students paying back their loans but for lenders. According to the Oct. 23, 2005 article titled "College loan plan raises questions" at NCTimes.com (North County Times) by J. Stryker Meyer, "A General Accounting Office report noted that people who consolidate their loans are three times less likely to default on their student loans."
NextStudent believes that getting an education is the best investment you can make, and it is dedicated to helping you pursue your education dreams by making college funding as easy as possible. Learn more about Student Loan Consolidation.
============================ The End =========================
Posted by
. :~ ShAh G . :~
at
3:50 PM
. :~ ALIVE FUN ARTICALS ~: .
Is this the price you have to pay for higher education, or can you avoid college debt in the first place?
Because most college students are using loans to finance their college education, the debt level of recent graduates is rising rapidly. On average, students graduate owing $12,000-$16,000 in student loans and another $2,000 in credit card debt. Is this the price you have to pay for higher education, or can you avoid college debt in the first place?
The secret to avoiding college debt is to plan wisely and take advantage of the many opportunities to reduce college costs before and during your college years.
Planning ahead
You can avoid college debt by making wise high school decisions:
Take advanced placement classes
Take all the advanced placement classes you can in high school--every AP exam you pass means one less class you need to take in college.
Keep your grades up
Scholarships can be competitive, and even the grades you make early in your high school years can mean the difference in winning or losing. Don't make the mistake of thinking you can save the hard work for your junior and senior years!
Stay involved
Scholarships also may depend on community and school involvement.
Search for scholarships and grants
Scholarships and grants are the best money source for college because it is money that doesn't have to be repaid. To find out about grants and scholarships, visit your high school career counselor and the Financial Aid Office of your intended college. You can also search the internet for scholarships and grants.
Investigate public service options
The United States Military, National Health Service Corps, and Americorps will give you money for your education in exchange for your signing up for a "tour of duty." The time commitment ranges from 10-12 months to 8 years.
Living wisely
The chances to make wise decisions and avoid debt continue into your college years.
Start out in a community college
Most towns and cities have two-year community colleges where you can take your basic courses at less cost than at a four-year college or university. Just investigate to make sure your community college credits will transfer.
Take advantage of Work-Study programs
If you qualify for the federal work-study program, take advantage of it! You will have an on-campus job, possibly in your field of study.
Or work for the school
Many colleges give discounted or free tuition to employees and their family members. There are lots of non-teaching jobs on campus that you can apply for.
Live frugally
Live at home or get a roommate. Avoid expensive spring break trips. Buy used textbooks, and sell your books at the end of the semester.
I already have a loan. Now what?
If you have a federal student loan, it is possible to have your loan debt discharged (canceled) or reduced, under certain specific circumstances:
* You die or become totally and permanently disabled
* Your school closed before you could complete your program
* You work in certain designated public school service professions (such as teaching in a low-income school)
* You file for bankruptcy (only if the bankruptcy court rules that repayment would cause undue hardship.)
As you can see, there are many steps to avoiding or relieving college debt. To best manage your debt it is wise to implement a combination of the strategies listed above that work best for you.
============================ The End =========================
Posted by
. :~ ShAh G . :~
at
3:47 PM
. :~ ALIVE FUN ARTICALS ~: .
If savings, grants, scholarships, and federal loans don’t cover the cost of your education, it’s time to turn to private loans. But young college students can’t qualify for a private loan, can they? Wrong! This article addresses this and other myths about student loans that you may run into.
At least 20% of college students need some type of loan to help pay for their college education. Such a statistic can lead to students graduating with an unmanageable debt load. An alternative is for parents to help out by taking out loans themselves. But which is the better option - student loans or parent loans? Each has distinct advantages and uses.
Federal student loans
Federal student loans have the lowest interest rates and best repayment options. If you need to take out loans and you qualify for federal loans, this is your best choice. Just be sure to accept only the funds you need, even if you are offered much more. Parents can always help their children pay off these loans once repayment begins after graduation.
Federal parent loans
PLUS Loans ( Parent Loan for Undergraduate Students) are another loan option that comes with low interest rates. If you are a parent with dependent students attending college at least part-time and you have a good credit history, you are eligible to receive a PLUS Loan. These loans are not needs-based. You can borrow up to the total cost of undergraduate education expenses, minus other financial aid already received. Unlike federal student loans, payment is not deferred until after graduation; instead, your first loan payment will be due about 60 days after the loan is disbursed. Also unlike federal student loans, PLUS Loans require an application fee.
Private loans
Both students and parents can take out private loans to cover funding gaps. Terms are basically the same for these loans, although students may be able to have their repayment deferred until after graduation. Another consideration is that students may wish to take out small loans to begin to establish a credit history. You may need to cosign for private student loans.
Other options
Parents do have some additional options for college funding, such as home equity loans. These often have rates as good as private loans.
So which type of loan should I get?
This really comes down to a personal decision. Ask yourself these questions as you are trying to decide:
* What level of debt do you feel is manageable for your child to graduate with?
* How important is it to you that your child takes responsibility for paying student loans?
* Will you and your child work out a repayment plan to repay PLUS Loans and other parent loans?
============================ The End =========================
Posted by
. :~ ShAh G . :~
at
3:46 PM
. :~ ALIVE FUN ARTICALS ~: .
Which is the better option - student loans or parent loans? Each has distinct advantages and uses, learn about them here!
Parent Loans or Student Loans - what is going to be best for my child?
At least 20% of college students need some type of loan to help pay for their college education. Such a statistic can lead to students graduating with an unmanageable debt load. An alternative is for parents to help out by taking out loans themselves. But which is the better option - student loans or parent loans? Each has distinct advantages and uses.
Federal student loans
Federal student loans have the lowest interest rates and best repayment options. If you need to take out loans and you qualify for federal loans, this is your best choice. Just be sure to accept only the funds you need, even if you are offered much more. Parents can always help their children pay off these loans once repayment begins after graduation.
Federal parent loans
PLUS Loans ( Parent Loan for Undergraduate Students) are another loan option that comes with low interest rates. If you are a parent with dependent students attending college at least part-time and you have a good credit history, you are eligible to receive a PLUS Loan. These loans are not needs-based. You can borrow up to the total cost of undergraduate education expenses, minus other financial aid already received. Unlike federal student loans, payment is not deferred until after graduation; instead, your first loan payment will be due about 60 days after the loan is disbursed. Also unlike federal student loans, PLUS Loans require an application fee.
Private loans
Both students and parents can take out private loans to cover funding gaps. Terms are basically the same for these loans, although students may be able to have their repayment deferred until after graduation. Another consideration is that students may wish to take out small loans to begin to establish a credit history. You may need to cosign for private student loans.
Other options
Parents do have some additional options for college funding, such as home equity loans. These often have rates as good as private loans.
So which type of loan should I get?
This really comes down to a personal decision. Ask yourself these questions as you are trying to decide:
* What level of debt do you feel is manageable for your child to graduate with?
* How important is it to you that your child takes responsibility for paying student loans?
* Will you and your child work out a repayment plan to repay PLUS Loans and other parent loans?
============================ The End =========================
Posted by
. :~ ShAh G . :~
at
3:43 PM
. :~ ALIVE FUN ARTICALS ~: .
You need some more money for college expenses this semester. Do you whip out a credit card to pay for your books or do you apply for a federal or private loan? Well consider the options
* With a federal loan, your interest rate will be low (around 5%) and your payments will be deferred until 6-9 months after graduation.
* With a private loan, the interest rate will be slightly higher than with a federal loan but will still be lower than average. In addition, you will only need to make interest payments until after graduation.
* With a credit card, on the other hand, the interest rate can be as high as 21%. Interest begins accruing almost immediately, and you need to begin paying off the bill the next month.
This is not to say that credit cards do not have a place in your college life. It is good to have one national card (Visa, MasterCard, Discover) on hand to help you build a positive credit history and to provide security in emergencies. When you decide to apply for a card, compare annual fees, interest rates, and introductory offers. And to keep yourself out of debt, try to-
* Pay your balance each month to avoid interest charges
* Pay your bill on time to avoid late charges
* Avoid cash advances, which come with large finance charges and interest that begins accruing immediately.
============================ The End =========================
