Posts Tagged ‘Perkins Loan’
March 9th, 2010
When a student or parent sets out to obtain a loan and/or financing a college education there are a many different sources they can go to in order to acquire the funding necessary. However, there are two different categories of loans which are either federal loans or private loans.
As for federal funding for college, in many cases it is much easier to get the financing if you fit the criteria set in place. By far, one of the most popular federal student loans is the Stafford loan. There are two types of Stafford loans which are the federal family educational loan and the William D. Ford federal direct loan. The process of obtaining a Stafford loan is through the student filling out a federal student aid application, then once approved they will sign a promissory note on the loan.
The only real difference between the two types of Stafford loans is where the actual funding is coming from. For a direct loan, the funds are coming directly from the federal government as for a FFEL loan, the funding comes from either a bank, credit union or another participating lender in the program.
There are also a couple more that should be mentioned in this article and those are the Parent PLUS and Perkins loans. First, the Parent PLUS loan is designed for parents in need of assistance for paying their child’s college fees. This loan basically will fill in any gaps that the parent needs in order to cover all the college expenses fully.
The Perkins loan is basically a student loan which can be applied for at the college or university financial aid office which usually has a very low interest rat, but has a maximum loan amount of around $4,000 each year for students. They are federal fund and can be added to other types of funding. There are late fees and fees for skipping payments on the Perkins loan as well.
These loans and more can all be inquired upon at your selected college or university.
Credit history may not be as necessary if it is necessary at all in obtaining these types of funding options. As opposed to federal student loan funding, there are many private lenders willing to provide assistance for college funding as well. However, if you so decide to take the private lender route for financing a student loan, it is important to remember that most will need a bit of a credit history from the potential debtor and will most likely require a co-signer on the loan if the student with not much credit history at all is attempting to obtain the financing.
Federal funding for college students who need the financing, as well as parents is very available for anyone who has a need for such funding and it would be a good idea to look at all the options available in order to compare interest rates, fees, and more as these student loans will be around for a while after college as some loans will begin the payment schedule immediately during college like the Parent PLUS. Other repayment schedules will begin after 6 months for Stafford loans and 9 months for Perkins. So it would be a good idea to get all this information first hand before making any quick decisions about your college student loans.
By: S. Michael Windsor
November 1st, 2009
A student should always, once through college, initiate steps to consolidate their student loans. This article details the benefits available to graduates, parents or students who take those steps.
The Consolidation of Student Loans Brings Reduced Payments
When a student gets all his or her loans under the same Social Security number, then the government will agree to consolidate those student loans. The student’s individual loans are paid off, giving the student one large loan.
Moreover, when the government takes steps to consolidate student loans, it also takes two other important steps: It extends the loan and it lowers the loan rate.
There is not set way by which a loan provider can bring down the rate on a consolidated loan. A reputable loan provider carefully examines all the possible ways that a student’s rate might be made lower.
The loan provider then establishes that low rate as the rate for a consolidated and extended loan.
The government’s willingness to both extend the loan and to lower the rate can save students considerable money. Although the payment schedule has been extended, the person with the consolidated loan can feel free to pay the loan off ahead of schedule.
In other words, there is no prepayment penalty levied on those who make an early pay-off after choosing to consolidate student loans.
Two More Reasons to Consolidate Student Loans
It was mentioned above that the rate on a consolidated loan is lower than the rate on each of the original loans. Besides being lower, that rate is also fixed. The rate on a Stafford or Perkins Loan is variable.
The rate on a consolidated loan does not change during the course of the loan.
A student with a consolidated loan does not need to spend time keeping track of the payment schedule for two, three or more loans. That student loan recipient can just make a single monthly payment.
Often the student elects to make that single payment through an automatic debit. That can decrease the loan rate by another 0.25%.
Still Other Reasons to Consolidate Student Loans
Gradate students who consolidate student loans can learn then about fellowships and graduate school loans. Parents who consolidate their loans can search for free money or private loans. Those benefits come on top of the loan’s lower interest rate.
When you consolidate student loans, you provide yourself with a chance to improve your credit score. No graduate wants to face credit problems that have been caused by his or her need to take out loans in order to cover college expenses.
In light of all the above benefits, students should ask this question:
Who Can Qualify for the Program to Consolidate Student Loans?
Before allowing a student to consolidate student loans, the government looks to see if the student or graduate owes $10,500 or more.
The government also checks to see if the loan recipient has any loans in default.
By: Martin Haworth
October 28th, 2009
Consolidating student loans is simple: If you meet certain requirements and you have student loans, you can consolidate them into a single loan. What this means is that the lender you choose will pay off the current student loan amounts that you still owe, and will combine the different amounts that you owe into just one loan. When the lender does this, you will probably see your monthly payment on student loans drop. And that’s just what you are looking for, an easier and more affordable way to pay down your student loans.
Both students with student loans, and parents who owe on PLUS loans that they took out for their students, can consolidate their loans. Consolidating student loans (as long as they are federal student loans) does not require that you have a credit check done to prove that you qualify. Is that surprising to you? Well it’s true. Your credit score, no matter what it is, does not disqualify you from getting a federal student loan consolidation approved.
To start out, you’ll need to know whether your loans are federal student loans or private student loans. Federal student loans have the backing of the federal government and are usually known as the Perkins Loan, Stafford Loan, PLUS (Parent Loan for Undergraduate Students) or loans from the Department of Education. There are also other kinds of federal student loans, so you’ll need to look at your student loan report to check on what type of loan you have. A private student loan is a loan that you or your parents took out from a private lender, and loans like this are not backed by the federal government and do not qualify for federal student loan consolidations.
If you are falling behind in your payments on this type of loan, call the lender that you make payments to and ask whether you can consolidate your loans with them or negotiate lower monthly payments.
For consolidating student loans, you have to:
• Have at least $10,000 in student loan debt. This $10,000 must be all federal student loan debt, not a mixture of federal and private loans.
• Be in your grace period or repayment period. Your grace period is the time period after you take out a loan before your payments start. Your repayment period begins after your grace period ends. Your repayment period is when you make monthly payments on your loan(s).
• Not be in default status on any of your loans. Default status is when you have fallen several months behind in your payments and you have received a notice of default from the lender. If you are in default, don’t be afraid to look for a consolidation loan anyway. A lender may be able to work out an agreement on how you can pay off the default and still consolidate your loans.
• Be a U.S. resident or permanent resident. Notice that citizenship is not a requirement, just residency.
• Not have consolidated the same loans before, or have gone back to school and accrued more loans to consolidate with the original consolidation
By: Bruce D Hunter