Friday, 29 May 2009

Consolidating Private Student Loans

Now is the time for consolidating private student loans. The prime interest rate, which many loans are based on, is at the lowest point in years (3.75%). If you originally got your loans in the past few years they may be as high as 8% or more.

Consolidating your student loans can help you save money and even give your credit score a boost. Lets say you have anywhere from 4 to 8 student loans that you are paying back right now. When you consolidate them with one loan, the individual loans are paid off. That’s always a good thing on your credit report.

Depending on the term of your student loans (usually 15 or 30 years), the savings can be substantial. Lets say you have $30,000 in multiple loans at 15 years and 6.8% interest. Your monthly payment would be $267. If you consolidate all of the loans into one for 30 years at 3.75%, your payment would go to $139 per month. If your current interest rate is at the max of 8.25%, your savings would even be more.

That’s almost a savings of 50% off your payment. Even if you opted for the 15-year note, you would still save up to 20%. Depending on your amount, which is probably more than $30,000, the savings could be very impressive on any monthly budget.

Combining all your loans into one also saves you a lot time and headaches when you make payments and record keeping. But you also have to be careful. There are a lot of companies that will be more than willing to loan you the money, but the devil is in the details.

Some start off with low payments, then balloon at certain periods (say at 2nd, 5th, and 8th years your payments go up) based on the position that your income will increase also. This can be dangerous depending on many factors not in your control.

When considering any consolidation loan, look at the total debt. Look at all the fine print on time periods, payment schedules, and any penalties. Don’t take anything for granted, if it’s not in writing it doesn’t count. And once you sign the agreement, you are obligated to the conditions contained in the contract.

Make any decision based on the facts you know today, not sometime in the future. Read and understand every page of any document that you sign. It might be a good idea to have someone with knowledge in loans and contracts to review any documents before you sign on the dotted line. Keep in mind that you may not even get the 3.75% interest rate offered.

The interest rate you are offered is based on your credit score. Which is based on your payment history, amount of available credit (if you have several credit cards at or near your credit limit, that lowers your available credit), and other variables.

If you are just out of school and don’t have any credit built up, or worse yet, have trashed what little credit you did have, it’s time to make some changes. Anyone can improve his or her credit score with a little time and effort. It’s also going to be important when you get to a point where you want to buy a house.

With interest rates down at the lowest points in years, the opportunity will never be the same to reduce that college debt. If that means you need to work on your credit score, so be it. You are now in the real world and reality is very difficult to avoid.

Your credit score is very important when it comes to unsecured loans (since that’s what most consolidation loans are). The higher your credit score, the lower interest rate you will be offered in any consolidation loan. In fact, you may not even be eligible without the minimum credit score.

If you need help with improving your credit score there are a lot of free options available. Look for community or church programs that offer free assistance. If you need to establish credit, there are ways to do that also but it takes time. But the money savings will more than be worth the effort.

Wednesday, 27 May 2009

Student Loan Consolidation: Make your Student Loan Repayment Easier to Manage

Are you a May graduate with student loans looking at six-month grace periods that are ending sometime this month? If you’ve got multiple student loans going out of grace and into repayment, you’ll soon be faced with trying to juggle multiple bills, multiple due dates, and multiple monthly payments.

But you could eliminate the hassle of multiple student loan payments and help make your student loan repayment easier to manage by consolidating your eligible federal student loans with a Federal Consolidation Loan from NextStudent, a leading Phoenix-based education funding company.

What’s Federal Student Loan Consolidation?

Student loan consolidation allows you to combine your eligible federal student loans into one single consolidated loan with one lender, one monthly bill, and one convenient monthly payment. To be eligible to consolidate your student loans, you can’t currently be enrolled in school more than half time. The student loans you’re looking to consolidate must be in repayment, in a grace period, or in an authorized deferment or forbearance period.

Consolidating Federal Parent PLUS Loans

Parents with federal parent loans are also eligible to consolidate. Parents can consolidate the PLUS loans they took out to help you pay for school as soon as the PLUS loans have been fully disbursed and have entered repayment, even if you’re still in school full time. Although your parents can consolidate their PLUS loans, you won’t be able to consolidate your own student loans with your parents’ PLUS loans.

Take Advantage of All the Benefits of Federal Student Loan Consolidation

  1. No fees

  2. No cost to apply

  3. No credit checks

  4. No co-signers required

  5. No prepayment penalties

  6. Fixed interest rate

  7. Repayment terms up to 30 years

  8. One single monthly payment for all your eligible federal student loans

There are never any charges or credit checks to apply for a Federal Consolidation Loan with NextStudent. And there are no prepayment penalties, so you’ll never be charged extra fees just for paying more than the minimum each month or for paying off your student loan consolidation early.

Student loan consolidation lets you lock in a monthly payment with a fixed interest rate. You may also be able to cut your monthly student loan payments by as much as 50 percent when you consolidate your federal student loans with NextStudent. A federal student loan consolidation could extend the repayment term on your student loans by up to 20 years; by extending your payments over a longer repayment term, a consolidation loan could lower the amount you have to pay each month.

Private Student Loan Consolidation

If you have private student loans in addition to (or instead of) federal student loans, you won’t be able to consolidate your private student loans under the federal student loan consolidation program. But you may be eligible to consolidate your private loans separately with a NextStudent Private Consolidation Loan, which offers the same convenience of a single consolidated loan for your private student loans.

NextStudent believes that getting an education is the best investment you can make, and we’re dedicated to helping you pursue your education dreams by making college funding simple. Learn more about Student Loans, Private Student Loans and Student Loan Consolidation at

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Monday, 25 May 2009

Personal Student Loans – Where’s the Money?

Remember the old lady in the burger commercials that hollered, “Where’s the beef?” That’s the way many American parents feel as they scream, “Where’s the money?” Applying for a personal student loan for your family may be frustrating and seem impossible, but armed with a little information and a lot of patience, you can find the money you need to send your child into the world of higher education. Just be prepared for the applications, credit reports, financial statements, and loan papers that are a necessary evil in the student loan process.

Whether you are considering a private college or a public university, the cost for a college education is huge. But you want to give your kids the best shot at life, and you will do whatever it takes to assist them in receiving the education that will give them that edge. So where do you start? How do you know what you can afford? How much should you borrow? What programs are available for your family?

I am not a financial genius, and the prospect of dealing with loan documents and financial lingo makes me a bit anxious. So let me see if I can put some of what I discovered in plain ol’ American English.

There are four general places to look for student loans: A) The federal government, B) Commercial lenders, C) State programs, and D) Private and non-profit organizations.

Let’s look first at the federal government. When I first looked at how to take a bite out of Uncle Sam’s apple, the apple seemed so huge and so slanted toward need-based loans that I was sure I would not qualify for anything the federal government would offer. Simply put, I was wrong. A word of warning here: Don’t skip ANY step in the federal application process. No matter how absurd it may seem, every box you fail to fill out will keep money out of your pocket!

While the federal program seemed to be a ball of yarn I had no hope of untangling, I held my breath and dove in anyway. What I discovered was a lot of duplication and information that was much simpler than it seemed.

All the information I found talked about multiple types of loans, but the truth of the matter is there are two programs that are mirror images of each other. One set of loans is administered by the Department of the Treasury, and the other is administered by independent lenders. That is the only difference, and the individual colleges and universities will let you know which program they participate in.

The federal government does offer need-based loans. My misconception was that was all they offered. I was wrong. There are also options for low-interest loans to parents of college students, as well as options for students who are already independent of their parents, regardless of need. The key to applying for these is that you must be excluded from the need-based loans before you can qualify for the others. Here’s where the red tape comes in. You have to apply for a need-based loan even if you know you don’t qualify for before you can even be considered for the one you do qualify for. The answer: Fill out every piece of paper the government gives you. Otherwise you will never know what money you may be eligible for.

While it is the largest, the federal government is not the only resource for student loans. Whether you choose to apply for federal student loans or not, additional money can be found in the private sector. Parents can find money in their own banking institutions. Students can apply to the College Board for the CollegeCredit program with a 15-year repayment program and options for principal and interest repayment. ConSern Loans for Education offers loans to parents whose employers participate in the program. The Education Resources Institute (TERI) is a non-profit lending agency for parents or students. These types of loans are not always obvious, so ask your employer and other lending agencies what options they may have for you because of your credit-worthiness or employment.

Other methods of acquiring the funds you need for college include state programs. Your state may have an agreement with neighboring states to reduce tuition for its residents. The student’s area of study may also prompt your state to grant loans or reduced tuitions for your student.

Student loans are also offered by a number of private and non-profit agencies to those who meet certain criteria. Consider researching organizations that provide assistance for people of your ancestry, nationality, religion or denomination. Also, consider your child’s part time employment experience, participation in clubs or service organizations, athletic abilities, academic achievements, and potential career choices.

Finding the money you need to put your child through college is not a process to be taken lightly. You must begin early. Parental approval for a loan usually requires two years of an acceptable credit score, so be sure you are keeping up with your credit report throughout your child’s high school career. The average timeline for processing loan requests begins with the completion of the application process in May or June.

Usually those funds will be disbursed in August. If you delay, you can miss out on money that was disbursed before you finished your paperwork.

Be thorough in your search for personal student loans. You can get the money you need for college today if you will ask everyone who will listen, and don’t assume you won’t qualify. Don’t find yourself on the first day of your child’s college career asking, “Where’s the money?” Whether you choose a federal student loan or a private student loan, do your homework and be patient.

Thursday, 21 May 2009

Be in the School You Want With Affordable Student Loans

When your scholarship and/or federal loans that you are relying on come up short, there are affordable student loans to the rescue that could help you pay for some college education expenses. Some loan and financing companies do have a private student loan program which is offered online so you can save a great deal of time. Aside from an easy application most firms had designed great payment scheme options and rates which are really affordable.

There are still a lot of families and students who rely on federal student loans which has the lowest interest rate and the most flexible repayment terms you can possibly think of. However, the sad truth is the fund can fall short in covering your college expenses. Good news is private student loans can help you fill any cost shortage on books, tuition fees, dormitory and all other students miscellaneous fees.

Student loans can be easily approved when all the needed requirements are met especially with the help of a co-signer and receive the fund they needed for college in few short days. Applying with a co-signer increases your chances of approval and helps lower the interest rate. If you opt to apply with the help of a co-singer it would be beneficial for you to learn some facts about it. A co-signer is a person other than the borrower of course who signs for the loan and is willing to take an equal responsibility for the repayment. Most students prefer to apply with these people because it gives them the better chances of getting a batter interest rate. Co-signers need not to worry because he is released from the liability when the borrower had successfully made the repayment on time for the first forty-eight months. As long as the borrower can meet the required credit criteria after the co-signer had been released, the interest rate will remain the same. This kind of loan is just so perfect when all the other forms of financial aid are not sufficient to help you sustain the full cost of college education.

Here are just some of the reasons why student loans are reliable: you are allowed to borrow up to forty-five thousand dollars yearly, you can get the loan with a very low and reasonable interest rate, you can be offered of flexible repayment options, funds are released quickly and the application is made easy through online sites.

Some financing firms who offer such loans give their clients or borrowers the following benefits: they offer cash back; a student can receive a certain amount of principal reduction on every loan upon graduation. Some would defer payments on your loan to help you get focused on school. A grace period is given to the borrower. When you finish college or maybe got tired of school and decided to drop, you are given a six months period (months depend on companies) before start paying again. There are three common types of repayment terms: you may choose to pay only the monthly interest while still in school. Alternatively, you may want to start making the monthly and interest payments immediately, or you may opt to defer all principal and interest charges while in school .Remember though that the interest will accrue during this period and will be added to your loan balance.

Monday, 18 May 2009

Chased Away From Student Loans — Some More Digging

On April 17, I checked my inbox and found a message from a reader who had read the previous day's column on the JP Morgan/Chase decision to discontinue lending to schools with historically low repayment rates.

I had pointed out that Chase's spokesperson refused to list the affected schools, but that borrowers deserved to know. I also added that such information would end up becoming public anyway, as unhappy borrowers would eventually post it on the Internet. Finally, I stated that the government should provide borrowers, educators and lenders with a list of schools that have below average default rates.

This morning, the reader told me that the U.S Department of Education (DOE) already publishes such a list and it is available to the public. So, I went to their site to take a look. One thing I learned was that you needed to know their terminology in order to find the list. It took some digging to find.

I appreciate the reader pointing this out, because I learned more than I expected. The DOE tracks cohort default rates. A cohort default rate, according to a PDF guide posted on the site, is based on a fraction: the number of borrowers who have defaulted on students over the past two fiscal years divided by the number of borrowers who begin to repay their loans over the past fiscal year. A cohort year is the same as a federal fiscal year, October 1 through September 30.

According to the DOE, A school is subject to sanctions, meaning the loss of Federal Family Education Loan (FFEL), Federal Direct Loan (DL), and/or Federal Pell Grant Program eligibility if the school has three consecutive official cohort default rates that are 25 percent or greater. Also, a school is subject to the loss of FFEL and DL Program eligibility if the school has an official cohort default rate that is greater than 40 percent for the most recent cohort year. The Web site also reported that no school had fallen under these sanctions since FY 2005.

And there is some good news: the national cohort default rate has dropped from a high of 22.4% in 1990 to 4.6 percent in 2005, the last year that the DOE has available data. Cohort default rates ranged from 4.5 percent to 5.4 percent between 2001 and 2005. That means that someone has done a better job of collecting the money from borrowers.

While I can't draw firm conclusions from limited research, I have to believe that private lenders use their own methodology to decide who qualifies for a student loan, as well as the DOE statistics. A 4.6 percent default rate, along with government guarantees and subsidies suggests that student loans are not a risky business, though it is possible collection expenses and subsidized origination fees — charged to students in direct lending - cut into their profits. Even then, some lenders chose to make gifts to financial aid officers to direct students their way. I'd have to guess that the profitability of student loans for the gift-giving lenders depended on receiving preferential treatment.

But my digging takes me back to my original question: how does Chase, or any other lender, choose the "haves" and "have nots?"

According to the DOE Web site, for example, Historically Black Colleges and Universities (HBCUs), Tribally Controlled Community Colleges (TCCs), and Navajo Community Colleges, as defined by statute, have been eligible for relief from the consequences of cohort default rates. As of September 2007, all 98 eligible HBCUs had official FY 2005 cohort default rates that fell below regulatory thresholds. No HBCUs are subject to cohort default rate sanctions.

While the federal government has provided relief, I must ask another question: How have the banks treated borrowers from these schools and others? I welcome any reader to answer.

(Originally published at Educated Quest blog and reprinted with permission of the author, Stuart Nachbar).

Saturday, 16 May 2009

Ideal Student Loan Consolidation Programs

Students pass out along with different kinds of loans to be paid off. They will have to repay each of those loans with different interest rates after the six months grace period making it even more complicated for the students. An ideal student loan consolidation program will enable the students to pay lesser amount towards interests and also put an end to different kinds of student loans.

The first step is to find the ideal student loan consolidation program. As each and every program has its own pros and cons, the student should weight them and select the best one to suit his needs and financial situation. The student loan consolidation program helps to combine different loans and pay as one single payment. The next step is to find the best interest rate towards repayment of student loans. The student needs to be very sure when it comes to the terms for payback, that is, he should find a reasonable loan termination period or date. He needs to be very careful, as it needs to be feasible to payoff the loan in the said date. Although, no one can predict the future, but can have an idea of how much money he can afford to pay taking his income into consideration.

It will be very helpful to find a flexible loan payback program. This will help them put their loan into forbearance during financial set back times, as there may be ups and downs in anyone’s life. This will help to put back their finances into order. Although the period may be flexible, it is not advised to have the loan interest rate to be flexible. It is good to keep the interest rate fixed, as it may be very effective in budget planning. While searching for an ideal student loan consolidation program care needs to be taken to find out if any penalty is levied for paying off the loans at an earlier date or for making early payments.

Tips on student loan consolidation programs:

While finding the best student loan consolidation programs, it is good to do your own research. With the help of Internet, anyone can search and compare different student loan consolidation programs. The students need to be aware of the fact that not all programs are equal. When getting in touch with the lender, it is always good to read each and every mail they send, as they can anytime change the terms and conditions, which might not be favorable to the student.

The student should be very organized in maintaining the documents and correspondences pertaining to the student loan consolidation program. They are very important as they spell out the obligations of the students. They should be maintained well until the loan is paid off to avoid any hassles in the future.

Counseling sessions may be conducted when the loan is obtained and after the student has graduated. These are very useful to the student as they provide the necessary information to act appropriately during the loan period.

About the Author

N. Sai is an expert in dealing with finance related matters. He has written several informative articles on topics like student loan, pay day loan, credit card, debt consolidation, building a good credit score, mortgage, home refinancing, loan and insurance. He regularly contributes articles to web guides on student loan and payday loan and

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Tuesday, 12 May 2009

Student Loans: A Bane Or A Boon?

Education is pretty expensive in today world. To add to the school and tuition fees, there are also the escalated expenses for books, lodging, and food and so on. Students find it very difficult to meet all these expenses. Therefore, they are forced to take student loans. Student’s loans are a mixed blessing. They may be a boon or a bane. Let us analyze them both.

Students Loans-A Boon:

Any student will tell you that student loans are a real blessing in disguise. The main reasons why students consider student loans as a boon are listed below.

1) Easy finance for expensive education: Since education is very expensive, it becomes inaccessible for anyone who lacks funds. At these times, it is only student loans that lend a helping hand to the students.

2) Take now, repay later: Students can take the loans now and repay after they complete their education. It is even possible to defer the repayment if you want to pursue higher education or if you face any financial crunches.

3) Independence: Students gain independence and freedom to pursue any qualification they desire irrespective of the parent’s educational and financial background. Thus, even an uneducated, poor cobbler’s son can become a doctor or engineer with the help of student loans.

4) Inculcates responsibility: Student loans inculcate a sense of responsibility in the students. They strive hard to improve their grades as they know that they have a huge loan awaiting repayment.

5) Even parents can take loans: PLUS Loan (Parent Loans for Undergraduate Students) is also available. These loans can be availed by parents for their children. The above points make it clear that it is definitely a boon for both students and parents to avail student loans. This is a great equalizer that can lead to a totally developed and wholly educated society.

Student Loans-A Bane:

There are two sides to any coin. Similarly, student loans also have certain disadvantages along with the above advantages. These demerits are listed below.

1) Cumbersome formalities: Certain lenders have a lot of formalities to be completed before awaiting the loan. Some of them require signatures for guarantee, co- signer, etc. These pose some more troubles for students who wish to be totally independent.

2) Immature students can face huge troubles: Some students are very immature and the easy money may lure them to accumulate huge loans. Since, they do not have to repay them immediately; they may keep accumulating them without any botheration. Only when they face the time of repayment, they are utterly shocked and start defaulting on their loan. Thus, early in life, they are caught in the vortex of bad credit and they have a poor credit score.

3) Cheaters also exist: Some lenders are shrewd while some are downright cheats. They may get the students to sign loan agreements without properly explaining to them all the terms, conditions and consequences. These students will get stuck with excess charges, high interest rates of long loan terms that they may not be able to handle.

Student loans may be a boon or a bane-it all depends on how the student handles the same. If you are wise, mature, plan your finances properly and then take a loan, you will find student loans to be a boon. Remember, to shop around, get quotes from various lenders before choosing the ideal one best suited to your purpose. Read the fine print of the agreement carefully, clear all your doubts and then, sign the agreement.

Monday, 11 May 2009

Primary reasons why federal student loan consolidation is an option worth considering

Many students use student loans as a means to finance higher education and carve out a better career for themselves. One of the main reasons for taking up higher education (especially when you have to borrow money to get it) is the lure of better and higher paying jobs that a person can get after completing their education. So, in that sense, it does make good sense to borrow money.

Federal government makes available several types of Federal student loans to suit the needs of various students. The private money lenders too have recognized this need of the students and offer various graduate loans, college loans etc.

By and large, the Federal student loans seem to be the most popular among the students. And many students use Federal loans for students as a financial aid for continuing their education. Some students might need to borrow more than once and hence end up with more student debt (Federal student loan debt or private student loan debt).

And sometimes, the students might find it difficult to repay the federal students loans that form a major part of their debt. This could be due to unanticipated financial crisis situation or due to overall changes in the economy that cause scarcity of good jobs or for other reasons. Whatever be the reason, in such a case the student is left looking for options and ways to tackle the problem. And generally, the problem is temporary in nature (unless the student is too undisciplined in his or her use of money).

For such students, Federal student loan consolidation comes as a great relief. Subject to certain terms and conditions (and eligibility criteria), the debt ridden students can apply for a Federal college loan consolidation.

The main attraction in going for Federal loan consolidation is that the immediate financial burden on the student is reduced i.e. the total monthly outgo is reduced. This is generally achieved either through increasing the repayment term of the Federal student loan or through getting the Federal consolidation loan at a lower interest rate than the Federal student loan interest on the current Federal student loan. However, these might not be the only reasons to go for student loan consolidation from Federal.

There are several other reasons due to which students opt for Federal consolidation of loans (please check the other article which discusses the secondary reasons behind considering a Federal college loan consolidation).

About the Author

To learn more about the Federal Student Loan consolidation options, you can visit the website This website contains a lot of articles and information on Federal student loans, college loan consolidation, graduate loan plans, student loan repayment etc. This information can be of a lot of use to students who are looking for easy access to such information. Moreover, you can even apply for loans (including mortgage loans and auto loans) through this website. And this process is really fast and effective; besides being just so easy that you will find it hard to believe.

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Saturday, 9 May 2009

Using Wachovia Student Loans To Get Your Degree

A college education shouldn’t be hard to achieve. However the financial demands of a college education can be high. Wachovia Student Loans will assist you in reaching your goal of a degree. Unfortunately much of today’s generation settles for a high school diploma due the high cost of tuition, books and board. However, when you focus on your objective and put your heart and soul to it, there should be no reason to stop you from attending college.

The Wachovia Student Loans is simply an educational loan. But there is more to Wachovia than just simply being an educational loan. There is a wide array of choices suited to your preference and situation. There are two ways Wachovia can help you get a hold of a student loan, namely the federal loan and the private loan.

The federal Wachovia Student Loans work with the government to provide you the finances to cover your tuition fees without burying you under a mile high of accumulated debt. The federal loans of Wachovia come in many forms and among them are the Federal Stafford Loan and Federal Plus Loans for both undergraduates and graduate students.

There is also a private Wachovia Student Loans that still basically helps you pay off the remaining difference in your tuition fees. However good this offer may sound, it is still advisable that you try the federal types of grants, scholarships, and loans before opting for a private loan.

Another ingenious solution from Wachovia is the Wachovia Education Loan which is designed for both undergraduate and graduate students, as well as professional and international students. Though it is pretty much the same as a private loan, it differs in the fact that it has some benefits that cannot be enjoyed with your standard student loans. These benefits include borrowing a higher amount of money than you might receive with your standard financial aid. With Wachovia Education Loan, you can opt to consign with someone else so that the interest rate of your loan will be lower. There are no additional fees with Wachovia Education Loan saving you money. In most cases the interest rate will remain the same as the original loan.

You will find that the Wachovia Education Loan is that similar to a federal student loan, you will not have to pay a single cent while you are still in school but you have the option to do so. If you slowly pay off your loan while you are still in school, the interest that is accumulated will be lower and will of course save you money. Another advantage of the Wachovia Education Loan is that they give you a maximum of up to 25 years to pay off your loan. Longer loan periods will lower you monthly payments when you graduate and start making loan payments.

All of these loans have their own special application requirements, most of them are need-based and you will have to qualify in order to be approved of a loan. Wachovia offers you a faster way to get approved with their online student loan application system. Though you have every option to pursue other financial aid services, Wachovia loan packages are very competitive.

Using Wachovia Student Loans to attain that dream of receiving a university or college degree is an important option to consider. Present economic conditions make finding a job tough if you only have a high school education. A college degree will provide you with many more career options and generally more income. The use of a student loan to achieve this goal is a very wise decision that will benefit you all your life.

Wednesday, 6 May 2009

Student Loans: Making Education Possible

Whether you choose to become a doctor, a lawyer, a nurse, or whatever profession, applying for student loans can make your dream come true. Getting into college is tough, made even tougher by the seemingly exorbitant tuition fees and other expenses needed to complete a degree. It is because of these financial demands that people become deeply discouraged and give up their dream of a college education. There really is no reason to become discouraged there are many opportunities to get student loans. If you do a good job of research you will find one that will meet your needs.

There are many student loans packages out there to fit every student’s financial need. To search for the best one, a student may consider contacting the college or university they are applying to for financial assistance. Counselors will have the latest information on grants, scholarships and student loans. You can also to a search on line to find what is currently available. The most common, and perhaps also the most affordable options for student loans are the federal student loans. The federal student loans have lower interest rates than personal loans, and they may come in the form of federal Stafford loans or federal PLUS loans, and Perkins loan.

With the federal Stafford loans, which may be subsidized (based on need) or unsubsidized (no-need-based), one does not need to make loan payments while still in school. On the other hand, federal PLUS loans which stand for Parent Loans for Undergraduate Students, are student loans granted to parents in behalf of their children.

Usually, the federal subsidized Stafford loan provides the best option for any student in deep financial need. In this type of loan, the government assumes the interest repayment until the student has already graduated and becomes able to make normal repayments of the loan. The federal unsubsidized Stafford loan is the kind of loan in which the student himself is responsible in paying the interest accrued during the course of the program. In both cases, credit check is not required. In addition interest from student loans generally tax deductable. This will become very important once you have graduated and beginning to make loan payments. It is wise to seek student loan consolidation advice from a professional a year prior to graduating.

The other type of federal loan is Perkins loan. Perkins loan is offered to students who greatly need financial help. The amount of loan ranges from $1,000 to $4,000. A good feature about this kind of loan is that there is a nine-month grace period after graduation for the borrower to start making his payments.

There is also another type of student loan which one can turn to in the event that the federal loans can not meet all of the required expenses. This particular type of student loan is called private student loan. It is often the best alternative to bank loans. Private student loans are credit-based, however, so if one desires to apply for this type of loan, he must have an acceptable credit rating. If the student does not have a credit record a student loan can be acquired through the use of a co-signer that does have a relatively good credit score.

In any case as you can plainly see there really is no financial reason for not attending college. Student grants, scholarships and loans all make getting your degree a reality.

Tuesday, 5 May 2009

Consolidate Federal Student Loans

When the need for a student loan arises due to the peak of financial challenges in your college years, you can usually can find the funding you need. In many cases a student will have to apply for more than one student loan before reaching graduation. Even if you happen to acquire several student loans, there is no need to panic as graduation nears. Remember that you still have the option to consolidate those loans.

There are basically two major types of student loans. First is the federal student loan which is guaranteed by the US Government through the US Department of Education. They have implemented a Federal Student Aid program as a part of their campaign to provide equal education opportunity for all aspiring college students in the country. Federal student loans are not considered direct loans to the student from the US Government. However the loans are provided by the US Department of Education and a loan servicing institution, When you need to consolidate federal student loans you have the opportunity apply for single loan to accomplish the needed consolidation. One example of federal loans used to make a loan consolidation is a Stafford loan.

As an alternative you can use private sources consolidate your student loans. Private student loans, on the other hand, are administered by privately owned lending institution. Some of the most well known private lending partners are also the leading financial institutions such as Citibank, Chase and Sallie Mae. In general private student loan rates are higher than public sector loans. However there may be more benefits in terms of payment schedules, payment deferments and longer loan repayment schedules.

For those who have incurred a number of federal student loans, the problems of managing the loans can be a problem for some people. As a result many wise student borrowers may opt to consolidate federal student loans in order to better manage their finances and save money.

Once a student has decided to consolidate their federal student loans, there are conditions that must be before they can qualify. First is that they should have more than one federal student loan. Next is that students should be in good standing with each of their existing loan accounts. This means they are either in their six-month grace period or they have already made three monthly repayments for each of the existing loans.

Under the wing of a federal student loan, there are also distinct differences between a subsidized and unsubsidized federal student loan. Although they can still be merged into one loan account, iIt is important to know the type of loans you have before you apply to consolidate your federal student loans.

It is obviously very important for the student to do their research prior to applying to consolidate their student loans. Only then will the student be able to make an informed decision. In many cases a student loan consolidation will save you money and reduce the stress of student loan repayment. Federal student loan consolidation is a wise investment in the future.

Sunday, 3 May 2009

Alternative Student Loans: When You’re Out Of Options

If you’re someone who has already taken all the government backed student loans for which you qualify, and are faced with a choice of finding a way to keep funding your education, or leaving school altogether, its time to start searching for alternative student loans. Leaving school without a degree will not only waste your academic efforts, it will. also deprive you of the chance at the maximizing your income in the workplace.

Almost all institutions of higher learning have some sort of alternative student loans available at reasonable terms. Sp you should head for your school’s student loan office, and ask someone if there are any alternative student loans for which you might be eligible. Within minute you should be looking at the school’s selection of alternative student loans.

Discuss with the student loan officer the pros and cons of applying for the available alternative student loans, and listen specifically to the conditions and terms applying to each of them. If you are already carrying a debt burden from government backed student loans, you should not commit to taking on any more financial responsibility than you can handle. All your student loans will become payable within six months after your graduate, and if some of them were offered with excessive interest rates, they could put a crimp in your financial future for a very long time.

Other Alternative Student Loan Lenders

If your school loan office has nothing promising in the way of alternative student loans, you can turn to a bank or commercial lender. They are often eager to provide alternative student loans to those students who have shown that they are financially responsible. Your credit history will weigh heavily in their decisions whether or not t offer you alternative student loans, and if it is good you should qualify fairly easily. If you are accepted for a bank or lending institution’s alternative student loans program, you can expect to receive your funds shortly after filing an application.

Collateral And Cosigners

If, however, you are like many students and have either no credit history or a shaky one, you may have difficulty procuring alternative student loans. You will very likely be turned down by the banks and lending institutions unless you are able to provide some sort of collateral, or security, in case you default on the loan.

If you lack collateral, as most students do, you can still qualify for alternative student loans from banks or commercial lenders by finding a person with a good credit rating or collateral who is willing to cosign the loan application. This person will have to be willing to be on the hook for the loan payments if you back out, so before you ask someone to be a cosigner , be sure your relationship is solid enough to handle the strain. For more info see on School Loan.

Finding banks or commercial lenders to handle your alternative student loans applications should not be difficult, as the student loan market is highly profitable and growing rapidly. And should you qualify on your own for some alternative student loans, you may be able to relieve some of the stress of paying them back with a student loan consolidation after you have graduated!

Friday, 1 May 2009

Availability Of Student Loans With No Security

Many wonder if there are student loans offered with no collateral. There is no simple answer to this question as it really depends on the applicant’s qualifications. There are of course federal loans that require no security and even private loans that do not require security but qualifying for them is not such an easy task.

Thus, in order to know whether you will be able to obtain a student loan with no security you need to know the different loan types offered and whether you meet the requirements needed to get approved for federal or private unsecured student loans. Also, if you can provide collateral to secure a student loan, you should rethink your decision of not doing so.

Federal Student Loans And Private Unsecured Student Loans

Federal Student Loans are student loans subsidized by the government, the interest rate they charge is significantly low since they are meant for promoting education and handled by government agencies with that purpose. The interest rate charged by these loans is even lower than the rate charged for home loans or home equity loans. However, the rest of the loan terms are not so advantageous. Though the repayment program can be long, usually, the loan amount you can obtain through these loans is not good enough to cover all college expenses.

Besides, these loans are awarded according to the needs of the applicant because they are meant to promote education for underprivileged applicants and thus, not everybody can apply for these loans and get approved successfully. Only those that meet these particular requirements of federal student loans should contact the government agencies to obtain further information on these loan programs.

Private unsecured student loans do not require collateral either. Thus, non homeowners can easily apply for these loans. However, the interest rate charged for these loans is usually high. Thus, only those that can afford the monthly payments on unsecured student loans will be able to get approved for them.

Unsecured student loans subsidized by private non profit organizations charge a lower interest rate but suffer the same restrictions as government loans. These loans are either awarded according to the needs of the applicant which excludes those with repayment capacity or according to merit. This last group of loans is meant to promote those who have had an outstanding performance on previous studies and thus, the institution wants to support their career.

Reconsidering Secured Loans

As you can see, getting approved for unsecured student loans is not that easy. So, if you are a homeowner or you have relatives or friends willing to offer an asset as guarantee of the loan, you should reconsider applying for a secured loan as you will get approved more easily and you will also get better terms on your loan including lower interest rates, higher loan amounts, longer repayment programs and thus, lower monthly payments that will be a lot easier to afford. As regards collateral, as long as you make sure you can repay the loan installments there is no reason to fear repossession of the property.