Category: Parent Student Loans

Applying for a Direct PLUS Loan by a Parent

The Federal Direct PLUS Loan is a federal student loan service that is designed to help students get a higher education when they are having financial troubles or when they are financially incapable to pay for their college expenses. Unlike other student loan services that may cause you to have a huge amount of debt after you graduate, the Direct PLUS loan is a federally granted subsidized loan that is designed solely to help students pay for their tuition and college expenses with enough motivation to finish quickly and repay the loan after they have jobs when they graduate.

If you are a parent and you feel that you are unable to pay for your childrens college expense but want them to have a higher education, you can apply a Direct PLUS loan on behalf of your children. You would first need to discuss with your child whether he/she want to take the loan or not. If the answer is yes then your child would need to accept the offer on his/her AppalNet account (there is information on how to do this elsewhere). You should first check the information available about the Direct PLUS Loan regarding their interest rates, endorser alternative and credit checks thoroughly and then decide whether you as a parent would are eligible or not in getting the loan and whether the interest rate offered suits your financial state at the moment. Having doing all of the things mentioned, you would need to do some more deciding and some steps to apply for the loan.

You would first need to decide whether it is you or your spouse who will be applying for the Direct PLUS loan because the application steps would need to be done by the same parent from the beginning to the end. The said parent would need to have the Federal Student Aid PIN number (the PIN number is the same number you would need to have to sign in to the FAFSA). If you don’t have a PIN number yet, you should visit the Federal Student Aid PIN web site and get a PIN number. After successfully getting a PIN number and get inside the site, you would be asked to complete the Federal Direct PLUS Loan Request Form that you would need to return to the Office of Student Financial Aid afterwards.

When you finish the form you would then be required to go to the official Federal Direct Loan website. It is highly advisable to learn more about the application process of the Federal Direct PLUS Loan inside the site by clicking the FAQs tab and proceeding to the PLUS application Process and Credit check link. You can sign in to the site with the Federal Student Aid PIN number afterwards and select Complete MPN once you are successfully logged in to the site under the Master Promissory Note section. You should then choose Parent PLUS and begin the credit check and application process.

After completing the entire Federal Direct PLUS Loan MPN process the program will then complete a credit check. Providing the credit check is approved, the program will then notify the ASU Office of Student Financial Aid that the said loan is approved. If the loan is approved, you will also receive a notification that you should print out and save for your records.

Government Grants Information l Minority Loan Tips

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Federal Student Loan Information

The Federal student loan program is called the Direct Loan program. This is a low interest loan for students and parents to help pay for education beyond high school.

The loan is issued by the U.S. Department of Education directly, and there are no banks involved with these loans. Because you are borrowing directly from the federal government you will be able to administer everything to do with your loans using the Direct Loan Servicing Center. This makes it easier especially if you have multiple loans from different schools.

There are a number of types of loans that fall under the Direct Loan Program and there are some important differences that you should be aware of about how they charge interest.

The subsidized loan is for students that have a financial need determined by federal regulations. With this loan there are no interest charges while the student is in school at least half time.

There is also no interest charge during the six month grace period following the completion or termination of classes, nor any deferment periods.

The unsubsidized loan is not based on financial need, and there will be interest charged as soon as the money is distributed. This means that even though you are not obligated to pay on the loan while in school, you will be charged interest during this period. You will also be charged interest during the six month grace period and any deferment periods.

The Plus loan is an unsubsidized loan for the parent of the student to help cover any educational costs not covered by any other financial assistance. Interest is charged during all periods for this type of loan.

There is also a Consolidation loan that combines any eligible federal student loans into one Direct Consolidation Loan.

This has the advantages to lower your monthly payments by spreading you loan out over a longer term. While you will lower your monthly payment, you will pay more interest because of the longer term.

You can apply for any of the Direct Loans by filling out the Federal Student Aid application online. The information in the application is transmitted to the school you list in the applications and is used to determine all financial aid that might be available to the student.

There are no required payments due until the student falls below a half time status and there is also a six month grace period after graduation or termination in most cases. We will cover payment requirements and options in future articles.

Take advantage of up to date free Federal Student Loan Information and all other Student Loan Information by visiting GetStudentLoanHelp.com today.

Question by Moonspell: Serious need of a funds for my schooling.?
I am here on a F1 student visa. I was comfortable as my parents were paying my expenses. But rescently the business of my parents crumbled down to pieces, he could no longer send me money. As a matter of face they are having a harsh time. So i need to find a job here to pay my fees. As i have invested much money in my studies, i cannot even go back to my country, i have to complete my degree. But, as it’s illegal to work here, what are the options available to me?

you might ask me to find on campus job or to get work permit for certain hours showing economic hardship, i have tried it all but in vain. Some of u might come up with an idea of loan but i have been told that it is better to be broke than to drown in loans.

“Man! being a broke F1 in US sucks.”

I would really appreciate if u could tell me any options i have.

Best answer:

Answer by nsecurenold
You could try getting loans that you don’t have to repay until after graduation.

Know better? Leave your own answer in the comments!

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Advice for Repaying Student Loans

Student loans are debt. While this may seem to be self evident, many young people tend to regard student loans as a nuisance left over from their student days. These loans are lightly regarded until it is too late, and their credit standing has been compromised. For the recent graduate, it is wise to assess the total accumulated debt from college and establish a plan to repay it quickly.

Although the combined amounts of the student loans can be astoundingly huge, the government who backs the loans tends to make even the largest loans manageable for the borrower. The good news is that most college graduates are able to find decent jobs and have little other debt to contend with at this point. This means that with another couple of years of tight living, most of the student loans can be eliminated.

See if any government programs exist in your field to reduce or write off student loans.

Jobs that deal in social areas like education, often have programs that target them to help pay off student loans. Usually, these programs require the young worker to stay in the field for about 5 years to reduce the loan to zero. A percentage of the loan becomes a write off each year and no payments are required during this time. Many times, loans of ,000 to ,000 can be repaid in this fashion.

Look for grants and scholarships during the last two years of college that might be large enough to furnish funds to reduce the amount of the needed loans.

Sometimes, the best way to repay the student loans quickly is to find other ways to finance your education so that the loans do not need to be made. Even if you already have loans on the books, if your financial situation has improved, you may find grant and scholarship money to begin paying off your loans before you exit college. Anything that you can do along these lines is a big plus after graduation.

Try to only get loans that defer the payments and interest until after you complete your education.

By getting loans that defer the interest while you are in school, you can save thousands of dollars in accumulated interest that would pile on top of the money that you borrowed. Also, by taking out this type of loan, should you decide to pursue an advanced degree, you can defer the loans during this time, too. This will mean that large outstanding loans will not keep you from continuing to advance your education. Hopefully, the higher degree will translate to higher earnings and an easier time repaying the loans.

Attempt to bank as much of the loan as possible without spending it when it is received.

Instead of looking at extra loan money in terms of how many pizzas that you can buy, see if you can live without spending it. Put the excess each semester into an interest bearing account. If you can save 1/4 or more of the amount, this will allow you to pay down the loans considerably right after graduation. Smaller loans mean smaller payments and a better lifestyle for you. The argument might be made that the excess should be returned immediately. However, this will give a fund for genuine emergencies if needed. It also will accumulate some interest that will help reduce your loans even more.

If your parents have a whole life or savings type of insurance policy on you, consider asking that it be cashed in at graduation to help pay off your loans.

Many times parents purchase insurance policies with a small savings account attached for their infant children. By the time the child is 22 or 23 years old, these policies can have a cash balance of thousands of dollars. It is possible that the policies may be worth enough to completely pay the loans. If not, they may be able to dent it enough to make your life easier. Of course, you will have to purchase some more insurance, but in your early 20’s, this should be cheap if you are healthy.

Investigate receiving an early inheritance.

Sometimes grandparents or great-grandparents set up trust funds for their young heirs. If you have enough debt to be oppressive, they may be willing to give you an advance on your inheritance to help give your working life a boost. The problem with this approach is that it may mean that your children’s college fund has just been spent for your educational loans.

Written by ATeal

Question by ♫lala♥: How can I make my brother more independent?
My little brother’s 8 years old, and he’s in 3rd grade. I’m 13, and in 8th. Right now, my brother is really lazy and spoiled, since he’s the baby of the house, he always gets what he wants. My parents even pay him $ 10 a week to go to school! They never even paid me for good grades. And he gets rewards for his good behavior(ahem**picking fights in school and smacking people with shovels). He gets a new toy every month too. But most of all, he shows absolutely no interest in school. Me and my mom have to do his homework for him. Otherwise, he’d probably fail everything. Every night before a test, my mom spends 2-3 hours studying with him, and she gives him a dollar for every question he answers correctly. And she tells him the answer to all his homework problems. My mom also makes ME do his projects for him! ME!! As if I don’t have enough homework already, with two tests per week, nightly homework, and evil teachers who enjoy torturing us and giving us 0s for assignments. And my mom blames ME if he doesn’t get a 100 on his project.
Is there any way I can make my brother more independent? My mom also makes me do his Math24 Online for him, and I have to earn at least 100 points per day. I already tried talking to my mom, but she just yells at me for being a selfish pig, even though she never helped me study or do my homework when I was younger, that was always my dad. And right now, my parents aren’t divorced, but they’re living in different states to take a “break” from eachother.
I really want to stop doing my brother’s stuff for him, and I don’t think my mom should be doing stuff for him either. I started being independent in school in second grade, and I’m glad I did, because now I’m getting straight A’s. Also now, my brother’s getting my mom to open a bank account for him, because he’s already got over $ 3000 saved up in his wallet…while I have a measly $ 50. Plus, my mom has a special bank account for his “college savings”, and it’s not counting the $ 3000 he has in his wallet, b/c that’s his own money for him to spend, but I don’t know what he’s going to spend it on since he already gets everything he wants. All he has to do is point and scream “MOMMY I WANT THAT!!” and he gets it. He also has a laptop, computer, camera, cell phone, and ipod, when I only have a computer, cell phone, and ipod. When I ask my mom about my college savings, she just says “I’m sorry but we don’t have the money for you to go to college, you’re going to have to use student loans.”
Please help!!! I don’t know what to do!!

Best answer:

Answer by coch
I would say stop doing things for him, and try to make your mom understand she should do the same. He won’t become independent if he depends on others to do his homeworks etc… See what I mean?

Know better? Leave your own answer in the comments!

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Credit Unions Challenge Big Banks For Private Student Loans

Big banks that offer private-label college loans are facing new competition from credit unions that are looking to issue their own private student loans.

Credit unions, in increasing numbers, are developing partnerships with private student loan companies like Sallie Mae and Credit Union Student Choice to deliver private student loan products to credit union members. In one such agreement, Southeast Corporate Federal Credit Union, which itself has more than 400 member credit unions, will offer private student loans through Sallie Mae.

Private student loans, non-federal education loans issued by banks and private lenders, are designed to assist students who have exhausted their federal student loan options. Private student loans can be used to cover up to 100 percent of a student’s approved educational expenses.

Credit Unions Offering Flexibility in Student Loan Programs

Some credit union private loan programs are being structured to appeal to families with more than one student in college by enabling parents to make multiple withdrawals on a single line of credit worth as much as ,000. In addition, credit union–backed student loans are eliminating loan origination fees and offer both in-school student loan repayment and deferred, post-graduation repayment plans.

In-school repayment options enable students to reduce the overall amount of interest their private student loan accrues before they graduate. According to Sallie Mae, students who begin college loan repayments while still in school can reduce their student loan debt by 30 to 50 percent over traditional student loan payment plans, which defer repayment until after a student has graduated or left school.

Investors Looking to Private Student Loans’ Long-Term Growth

The prospects for private student loan companies and student loan securitization are improving marginally. The National Credit Union Administration (NCUA) recently sold a bond worth nearly .2 billion that was backed by student loans, after previously relying on commercial and residential mortgages to secure its bond sales.

Credit rating agencies are less sure that private student loan companies represent a good risk; however, many analysts remain optimistic about the long-term investment potential of private student loans.

Fueling investor confidence in the longer-term prospect of the private student loan market is the growing demand for student financial aid as record numbers of students are entering college each year.

Federal Budget Cuts May Pave the Way for More Private Student Loans

Indeed, private student loans may gain market share in a more immediate future than analysts had been predicting.

On Capitol Hill, the U.S. Senate is currently struggling to pass a continuation of its earlier spending authorization to fund the Department of Education’s federal Pell Grant program, which awards government-issued college grants to financially needy and lower-income students. The current authorization expires December 18.

If the Senate fails to reauthorize the funding proposal at its current level, students who are eligible for a Pell Grant may find their Pell Grant award reduced or eliminated. With less Pell Grant aid available to them, many of these students would then need to take out more money in student loans in order to pay for college and complete their degree.

Congress is already considering elimination of the Pell Grant program altogether, as recommended by President Obama’s National Commission on Fiscal Responsibility and Reform.

The bipartisan panel, which recently forwarded its final report to Congress, recommended that the federal government reduce federal education grants based on a student’s pre-college family income in favor of more government-issued student loans, which would need to be paid back, replenishing the government’s coffers, and that would be more attuned to a borrower’s post-graduation earning potential.

However, spending appropriations for an expanded federal student loan program may face stiff opposition in the Republican-led House of Representatives.

As Congress wrestles with the funding needs and long-term future of both federal grant and federal student loan programs, private student loan companies are positioning themselves to fill in any emerging federal financial aid funding gaps.

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