You can refinance your mortgage, but can you refinance your student loans? The short answer is: possibly. Let me elaborate.

Refinancing is a tool commonly used by borrowers in the housing industry to lower interest rates. In regards to student loans, refinancing options are not widely available and depend on the type of loan you have.

Consolidating Federal Student Loans

Federal student loans (such as Stafford Loans) are not able to be refinanced but they can be consolidated. For federal loans, you must consolidate them through a Federal Direct Consolidation Loan which determines your new interest rate as a weighted average. Unfortunately, weighted averages do nothing to lower your rate.

However, there are still some benefits to consolidating your loans, such as:

• It lowers your monthly payment by extending the term of the loan
• It makes managing your repayment easier by combing multiple federal loans into one

Probably not the answer you were hoping for, but consolidation can be helpful to those struggling with high monthly payments.
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Every year we get the same question, so here is your answer:

For the 2013–2014 year, the FAFSA will be green, with a purple section for parents.

For the current year, 2012–2013 the FAFSA is orange.

In previous years:

• 2011–2012 FAFSA was Yellow
• 2010–2011 FAFSA was Blue

For detailed information on completing the FAFSA, visit FAFSAonline.

With all this talk of the impending Stafford Loan interest rate hike, many other regulation changes have been overlooked. Starting July 1, there are a handful of other updates to federal loan programs that borrowers should be aware of. These changes will not affect loans that were originated before July 1, only loans originated for 2012–2013.

Here’s a breakdown of what you can expect to see for this upcoming academic year:

Subsidized Stafford Loan Changes

No more subsidized loans for grad. students — Just like undergraduates, graduate students were previously able to receive both subsidized and unsubsidized loans. Starting this year, only unsubsidized loans will be available for grad. students at a 6.8% interest rate.

Elimination of interest subsidy for grace periods — Subsidized Stafford Loans were less expensive than their unsubsidized counterparts because 1) the interest rate was lower and 2) interest was subsidized while enrolled in school and during the 6 month grace period after leaving school. Starting this year, there will be no interest subsidy during grace periods, however, the subsidy will still exist while enrolled in school at least half-time.

UPDATED: Extension of reduced interest rate — As I’m sure most students have heard, a bill was set to expire this year, doubling the rates for Subsidized Stafford Loans to 6.8%. Luckily, Congress just passed a bill to keep the rate at 3.4% for the 2012-2013 year. Learn more about Stafford interest rates, past and present.
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If you borrowed tens of thousands of dollars from someone, knowing you would eventually have to pay them back, more than likely over several years, you would think the person from whom you borrowed would be a high priority. But amazingly, the vast majority of people who borrow thousands of dollars in student loans have no idea who their lender is.

Now granted, if you are still in school, it really doesn’t matter. Your lender only comes into play around repayment time. But if you have recently graduated college and are interested in consolidation or deferment, you may have to contact your lender. So let’s talk about how to do that.

If you have a federal student loan, such as Stafford, Perkins or PLUS, you can visit the National Student Loan Data System and enter your four-digit PIN number that you received when you filled out your FAFSA. If you don’t know your PIN, contact the Department of Education at 800.433.3242.

If you have a private student loan, you can either contact your school’s financial aid office, or request a copy of your credit report from Free Credit Report, which will list your outstanding loans and lenders.

Now that graduation season is upon us, we asked students to share with us the amount of debt they have accumulated (and will soon need to repay). Here are the results of our poll:

It’s awesome, albeit surprising, to see the number of students graduating debt free- conGRADulations! For everyone else, loan repayment might be a growing concern as that 6 month date draws nearer. If you’re concerned about making payments for whatever reason, there are some steps you can take to either lower or postpone your repayment.

Consolidate

First, I would suggest consolidating your loans. Consolidation offers a number of benefits including lower monthly payments; Plus, it makes keeping track of multiple loans easier. To defer federal loans, you will need to contact the Department of Education Direct Consolidation department. To consolidate private loans, grads will need to contact a consolidation lender. Interested? Read more about consolidation in our blog, From our Archives: Consolidation.

Defer

If you are unemployed or do not make enough money to repay loans, I suggest looking into an Unemployment Deferment or Economic Hardship Deferment. Deferments allow you to postpone payment for a certain amount of time, allowing grads a little extra time to get on their feet financially. While available for most federal loans, deferment options vary by private lender, so make sure to ask if this option is available for you!

Here is a link to the Poll – Click Here and Show us your Debt!

For seniors, graduation is quickly approaching! Unfortunately, so are those pesky loan repayments, yikes! Take a few seconds to vote on our most recent poll to let us (and all those soon-to-be-graduates out there) know how much debt you’ll be graduating with, and see where you fall on the scale!

View Student Loan Debt Survey Results summarizing the results (as of May, 15)

If you’re graduating with loans, make sure to look into loan consolidation to help with repayment!  Still in school?  Find a better way to pay search for scholarships or compare student loans.

Guys, I’m sure most of you are well aware of the option to register for Selective Service (yup, the draft) once you turn 18, but did you know that it could have severe financial repercussions if you don’t? Unfortunately, many students either do not sign up on purpose or simply forget to, however this can affect how much money you get for school!

There is a federal rule that states that “Any man required to register with Selective Service at any time must have done so to receive aid.” If you’re 25 or younger, make sure to register because after this age, it is impossible to register and you will be unable to receive federal aid from that point forward (or at least until the law changes).

Tips to avoid disaster:

1. Even if you’re not planning to go to school right now, still register! You may want to go back for your degree later in life.
2. Don’t assume you’ve automatically registered when you register to vote, not all states do this!
3. Double check that you are registered and get paper confirmation! Government offices do make mistakes, don’t allow yourself to fall through the cracks. You can go to the selective service website to find your name on the list of registered males, and while you’re there, print off a copy to have on hand.

What if you’re over 25?

You’ll have to prove that your lack of registration was not knowing and willful. This means providing as much information as possible as to why you did not register. For example, if you were living abroad at the time, this would be a legitimate reason why you may have forgotten to register. In order to go through with this process, you should contact your financial aid office.

If you are still unable to get federal aid for school, private student loans can be another good way pay for school.

For more information on these Selective Service rules, read this publication from the Department of Education.

Image credit: http://www.flickr.com/photos/erika_herzog/2404484280/

Not everyone is aware of all the loan options available to pay for college. Here are just a few to consider:

1) Federal Stafford Loans – These are federally guaranteed student loans. You can apply for subsidized Stafford loans and the government will pay the interest for you while you are enrolled. This is a great option for students and the most popular loan program available.

2) Parent PLUS Loans – The Parent Loan for Undergraduate Students allows parents to borrow through the federal loan program to pay for their child’s education. The loan is in the parent’s name.

3) Private Student Loans – Private college loans are not sponsored by the government but offer an alternative sources of funds for those that may not qualify for federal aid or who need additional funds. Private school loans are often in the students name with the parent acting as a cosigner.

4) Perkins Loan – Perkins loans are another federal loan for low income students based on eligibility. These loan funds are limited so apply early.

5) Credit Cards – Believe it or not, approximately 30% of students/parents put a portion of the tuition bill on their credit card. While we don’t recommend this option, it is a reality. To find and compare the best student credit cards, visit www.StudentPlatinum.com.

Once you graduate, consider consolidating your student loans to lower your monthly payment. The downside is you will pay more interest over the life of the loan by extending your repayment period. For additional resources, visit: www.studentloans.com, www.collegeloansolutions.com and www.gradloans.com.

A number of loan contracts and details differ based on the enrollment status of the student. Unfortunately, each college and educational institution may define the terms of enrollment differently. In most cases, enrollment must be at least half-time to qualify for financial aid at all.

When looking at graduate schools, you may be wondering how many credit hours are needed to be considered a full-time student, versus a half-time student. Here are some guidelines based on information gathered from a few types of schools:

Semester-based school with mostly 3 credit hour courses: Most institutions are using 9 credit hours as full-time and 6 credit hours for half-time.

Semester-based school with mostly 4 credit hour courses: Institutions use 8 credits as full-time with 4 credit hours for half-time.

Quarter schools: These institutions indicated using 6 credits for full-time with anywhere from 3-5 credit hours as half-time.

As a recent graduate, I say with utmost certainty that the major thing keeping me from doing masters degree right away is the crazy price tag. Well, that and I want to work a few years beforehand.

If there is one trend that has continued unabated by the economy, it is the growth of tuition costs in education. Schools have announced hikes of anywhere between 4-8% for their students to meet next year; this is a staggering jump on a product that many argue is already overpriced.

So, how can we beat the high cost of an advanced degree? (more…)