Private Student Loan Benefits Take Center Stage | 08.24.09

Posted in Private Student Loans By Student Loan Network Staff

studentsWe’ve all heard the saying, read between the lines, but most of us don’t bother.  I mean, can you honestly tell me you read the terms and conditions when you purchase something?  You probably just scroll down to the bottom and click accept.  Am I right?  I know I’m guilty of the latter.  I really should read the fine print – we all should.  The devil, after all, lies within the details.  Last year my friend April learned this lesson the hard way.

April attended Northeastern University from 2004-2008. During that time she amassed $35,000 in private student loan debt and about $20,000 in federal. She now holds a BS in Philosophy from a very prestigious university with no job to speak of.  Understandably with no income she has been unable to make her $300 monthly payment. But no worries, she can put those loans in deferment, right?  Wrong.  Had she known what she was getting herself into she probably would have gone with another lender.

She figured since she was able to defer her federal Stafford and Perkins loans (you have up to three years of deferment time on federal loans) she’d naturally be able to do the same with her private loans, but that was not the case.  The only deferment options available to her were a 48 month in school deferment and 36 month active-duty deferment for military personnel.  There was no deferral benefit for economic hardship. Yikes!

Now she is in way over her head. Her debt is mounting, late fees are being assessed, her credit history is in complete disarray, and her co-signer is now being affected.  Welcome to the world or adulthood.

When I asked April if there was one thing in particular she wanted me to be certain to convey in this blog she said, “Tell them to ask a lot of questions.  Tell them to do their homework.  Don’t be content to let the school’s FAO or a family member do all the work for you, which I did.  Know YOUR benefits.”

Some of the most common benefits you will find in the market today include:

  • 12 Month Economic hardship deferment
  • No origination, guarantor, or prepayment fees
  • Exclusive 2% graduation reward based on your outstanding principal balance
  • Rates as low as Prime minus 0.50%, based on credit evaluation
  • Repayment does not begin until six months after you graduate or leave school
  • Co-signer release

The six month grace period and economic hardship deferment option are two of the most highly sought after benefits with the economy still on the mend.

So my recommendation is to heed April’s warning and pay close attention to the benefits extended to you if/when you take out a private student loan.  It is far too easy to just scroll down to the bottom and click accept.  Read between those lines.  Sometimes it’s what you don’t see the first time around that can hurt the most.

Fore more information or to compare private students loans (click here).

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40 Responses to “Private Student Loan Benefits Take Center Stage”

  1. AL Rod says on December 29, 2009 at 11:39 am:

    This is the stuff most private lenders wont point out

    Reply To This Comment
  2. Betty says on December 28, 2009 at 7:41 pm:

    very helpful information

    Reply To This Comment
  3. amine says on December 19, 2009 at 6:17 am:

    i’ll try to prevent that!

    Reply To This Comment
  4. asnardo says on December 18, 2009 at 11:54 pm:

    The loans are dificul to understand but is good learn that for ou future

    Reply To This Comment
  5. angel says on December 18, 2009 at 10:26 pm:

    interesting

    Reply To This Comment
  6. susana says on December 18, 2009 at 9:09 pm:

    mistakes are always maken so reading throughly helps

    Reply To This Comment
  7. Adrianna says on December 17, 2009 at 8:03 pm:

    the random A’s were a bit distracting, and that is very good to know because now i know to look in spots to see if loans are trying to make me pay ten times more then what i borrow.
    thank you for the info

    Reply To This Comment
  8. Danidza says on December 14, 2009 at 11:04 am:

    wow, okay, I will not be making that mistake!

    Reply To This Comment
  9. MAIRA says on December 10, 2009 at 6:47 pm:

    thats why i don’t ike loans!!

    Reply To This Comment
  10. Divina says on December 7, 2009 at 5:13 pm:

    Hmm, that’s why I don’t like loans.

    Reply To This Comment
  11. Oana says on December 2, 2009 at 11:05 am:

    This is very helpful information. I am an international student looking forward to further my education in the Usa and my only option to cover all my tuition, room and board, personal expenses costs is a private student loan. The articles posted here are very helpful, thank you so much!

    Reply To This Comment
  12. joseaguilar says on November 23, 2009 at 2:16 pm:

    im on social security rehaving from a juvenile youth school in society and would like to be a counslor or a psychologist thank u and in need of student loans to suceed

    Reply To This Comment
  13. stacie says on November 20, 2009 at 12:32 am:

    this is a great article thank you

    Reply To This Comment
  14. Paul Obrejan says on November 11, 2009 at 12:50 pm:

    loans are dangerous, haha

    Reply To This Comment
  15. tony says on November 5, 2009 at 4:16 pm:

    taking out loans can be critical…

    Reply To This Comment

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