04.28.11 | Seniors, graduating with 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.

01.27.11 | Most popular student loans for college

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. 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.

10.12.10 | What is capitalized interest?

To begin let’s first delineate the difference between subsidized and unsubsidized Stafford loans.  If you received a subsidized loan for school NO interest will accrue while you are in school, sweet! If however you have an unsubsidized loan than you are not so lucky.  Granted you could elect to make interest only payments if you so choose while in school, but if you don’t that interest will later be added onto your principal amount, and overall will increase your debt.  Let’s take a look how.

So what is capitalized interest exactly?  When the interest is not paid during college, it is accrued and added to the principle balance. Capitalization occurs the day the deferment period is over and the interest accrued over the loan period is added to the original amount of the loan. This additional amount subsequently accrues interest, adding an additional expense to the loan.

Here is an example.

Loan amount: $6,000.

Interest per month: $20

Loan balance after 1 year: $6,240

Loan principal upon capitalization (let’s say after 2.5 years): $6,600

Then that $6,600 loan balance is used as the new benchmark instead of  $6,000.  Now the monthly interest may go up to $21.78.

This was just a very basic visual used to demonstrate the capitalization concept.  Actual balances and interest rate calculations may vary.

Confused about any other terms.  Check out the Student Loan Network Glossary.

Also, find more information on the Difference Between Subsidized and Unsubsidized Loans.

11.06.09 | Private Student Loans Hold No Restrictions

Posted in Financial Aid, Private Student Loans by Kristin Morris

private student loansIf I had a dime every time I heard someone say, “I need more funds for school,” I would easily be able to send my entire family to Harvard…TWICE.  It’s just the way it is these days.  We’re turning over those stones, calling our rich uncle, and exhausting every avenue we know of to find those extra dollars.  Perhaps that classic Ben Franklin quote which reads, “The only thing in life that is certain is death and taxes,” should be amended to include running out of money for school.  But there is hope.  Private student loans do not have a yearly borrowing cap like federal Stafford loans do.

Now let me first start off by saying that federal Stafford loans are the bomb.  Max those out first.  The problem, however, is that there isn’t much to max out.  Depending on your grade level you are capped at a certain borrowing threshold.  Is it just me or does that sound absurd?  In fact, let me just go on record now and say that I think that is the lamest rule I have ever heard!  The cost of tuition is the same for a freshman as it is for a junior!  Why the disparity?!?  Ok, that is a different blog for a different day.  Back to private student loans.  Private student loans allow you to fill in the gap that federal loans leave, and that gap is extremely wide for some.

There is no FAFSA when you apply for a private student loan and no hassles whatsoever.  You can use your loan funds for tuition, room and board, a new laptop, you name it (assuming it is school related of course).  So don’t be discouraged.  There are options right at your finger tips.

APPLY FOR A PRIVATE STUDENT LOAN

Scholarship Points code: NOHANDS4U

08.13.09 | Bad Credit Student Loans

Posted in Financial Aid, Private Student Loans, Stafford Loan, Student Loans by Student Loan Network Staff

We are often asked: What loans are available for students with bad credit?”.  In short, your options are limited.

For some detailed information on Bad Credit Student Loans, visit:

http://www.studentloannetwork.com/resources/bad-credit-student-loans.php

There are three primary student loans available – Stafford, PLUS and private student loans.

Stafford Loans do not require a credit check – so you are good there.

PLUS loans for undergrads are in the parents name.  If the parent has bad credit, then ask the lender if you can add a cosigner to the PLUS Loan application.  Generally, the PLUS Loan has lower credit criteria so you may be eligible for the PLUS loan even if you have been denied for another type of loan.

Private Student Loans do require good credit – now more than ever.  This loan is generally in the students name and a parent will act as a cosigner.  If the parent does not have good credit, anyone with a job and good credit can be a cosigner.  Regardless of the cosigner, if the student has very poor credit, the chances of approval are very low.

As always, talk with your financial aid office about your options and other sources of financial aid, including scholarships, grants and work study.

08.11.09 | Find the Best Student Loans for College

The variety of student loans available to pay for college can often make the process of selecting one confusing.  The best student loans often may not be as obvious as many suggest.  Start by checking in with your financial aid office and finding out what they suggest – and which lenders are recommended.

Your next step should be to do your research online.  Search for providers of the three basic student loan types:

  • Stafford loans
  • PLUS Loans and
  • Private Student Loans

The Stafford loan is the most popular as it offers a low fixed rate and very good repayment benefits.  For more  information, visit: www.StaffordLoan.com

The PLUS Loan is another federal student loan available to parents of undergraduate students.  The loan is in the parent’s name and must be repaid by the parent and comes with a low fixed rate.   For more information, visit: www.ParentPLUSLoan.com

Finally, Private Student Loans offer the widest variety of terms and benefits.  Check carefully with each lender to verify the terms and conditions.  Private education loans are typically in the student’s name with the parent acting as a cosigner.  For more information, visit: www.PrivateStudentLoans.com

Low income students may be eligible for the Perkins Loan.  Again, check with your financial aid office to determine eligibility.  Graduate students can visit www.GradLoans.com for graduate student loan options.