Nancy asks…
how much should i pay back for my student loans?
hi, everyone, i have a question about student loans..
Here is the case, I am an incoming freshmen at a college and I am planning accept the student loans offered by Federal Direct Loan Sub and Federal Perkins Loan. If I borrow $22,000 in total (4 years in college)as for my student loans, and I will be able to pay off my loans within 1 month after I graduate from college, how much is my repayment? Will the repayment be $22,000? or will my repayment be more than $22,000?
Can someone please help me out with this question? i will be very appreciated
PS: Federal Direct Subsidized Loans are based on financial need. The interest rate is subject to change each year on July 1. Repayment of principal and interest begins six months after graduation or withdrawal from school.
Nagesh answers:
If you were to repay your Subsidized Loan and Federal Perkins Loan one month after you graduate, you would pay slightly more than the amount you borrowed.
While you are enrolled at least half time, your Subsidized Loan and Federal Perkins Loan’s interest will be paid by the government. However, once you graduate, leave school, or drop below half time enrollment; the interest will start to accrue on your loans.
If you cannot pay off your entire student loan until 1 month after you graduate, you should pay back however much you can before you graduate. This will reduce your principal amount and therefore will reduce how much interest you will have to pay. Versus if you pay nothing while in school, once you graduate your total principal would be $22,000 (as you used in the example) and your interest will be based on that amount. Versus if you were to pay a portion of your student loans (lets say you can pay off 1/2 of the amount), once you graduate your interest will be based on the $11,000 which you have left.
Currently the Federal Perkins Loan (5%) has a higher interest rate versus the Subsidized Loan (3.4%). In this situation, because you plan on paying your entire loan amount within 1 month from graduation, you should pay off as much as the Federal Perkins Loan first.
Ken asks…
can i get new student loans if my old loans are in consolidation?
sad story….lost my job, divorced, Bal bla bla, i went into default with my loans. My federal student loans are now consolidated thru the program that Direct loans works with. I have paid them twice and the third is in the mail. My question is, am I eligible for more federal student loans, so i can go back to school?
please cite your information, so i know the information is trustwourthy. Thank you!
Nagesh answers:
This often happens.
People get out of school make the decision to consolidate and then choose to go back to school.
Because of this you are able to get more student loans even with your original student loans in consolidation…
Lizzie asks…
How do I take out a student loans from the Department of Education?
A relative was telling about taking out a direct loan through the Department of Education. But she didn’t tell me how
Nagesh answers:
You fill out the fafsa at http://fafsa.gov
Keep in mind, that those who are getting ready to start school now (fall) did THEIR FAFSA back in Feb and March. YOu are a bit late for that. Plan better next time. Do your fafsa now to start school in December.
Steven asks…
What is a Direct Student Loan?
I will be attending a 2-year college in the fall, and I will need additional funding to cover room and board. I qualify for financial aid, but that only covers tuition. My school offers something called a direct loan, but is that extra money on top of financial aid? Or is the direct loan the actual financial aid money that only covers tuition? *Note: I am not talking about the direct PLUS parent loan.
Nagesh answers:
Direct Loans are low-interest loans for students and parents to help pay for the cost of a student’s education after high school. The lender is the U.S. Department of Education (the Department), though the entity you deal with, your loan servicer, can be a private business.
With Direct Loans, you:
* Borrow directly from the federal government and have a single contact—your loan servicer—for everything related to repayment, even if you receive Direct Loans at different schools.
* Have online access to your Direct Loan account information via your servicer’s website.
* Can choose from several repayment plans that are designed to meet the needs of almost any borrower, and you can switch repayment plans if your needs change.
For more information visit http://www.direct.ed.gov/index.html
Carol asks…
What is the difference between a Stafford loan and a direct loan?
Is there any difference between them? From my research it appears as if it’s just different names for the same thing. I need help!
Nagesh answers:
A direct loan is a Stafford loan (That you get directly through your schools fin aid office). Not all Stafford loans are direct loans however.. Some schools don’t do the loans through them. You go through the lender to get them rather than the schools fin aid office. Direct loans have a slightly better interest rate too… 6% rather than 6.8%.
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