The main components of the federal Stafford student loan are the two types of financing programs for post-secondary students.
Stafford loans are under the administration of the US Department of Education and comprise the William D. Ford Federal Direct Loan (Direct Loan) Program and the Federal Family Education Loan (FFEL) Program.
Only students can apply for a Stafford loan by filling an FAFSA (Free Application for Federal Student Aid) and send it to whatever school they want. Once the form is reviewed, the school decides the financial eligibility.
For direct student loans, the federal government is the lender but the FFEL program allows you to choose the lender using a list offered by the school or a qualified lender.
Under this program, the federal government will guarantee for the loan.
The loan can be subsidized (the federal government pays the accrued interest while you're in school) or unsubsidized (the accrued interest will be included in your loan balance).
If a student brings all the correct documents, then he/she can benefit from a subsidized Stafford loan.
Each year in school influences the federal Stafford loan limits and also the subsidized / unsubsidized financing. Below you can find the current regulations that can influence your loan:
Pros:
- The credit checks are not required because the Federal government guarantees for the loan.
- The fixed rate interest rates are the lower interest rates on the market
- The repayment plans offer very flexible terms. This means that you will set the payment plan that fits you best and also you can consolidate your other loans into a single and more affordable one.
- During student enrollment the repayment is deferred.
Cons:
- Sometimes the loan limits are insufficient especially considering today's post-secondary education costs.
- You have to submit a FAFSA (Free Application for Federal Student Aid).
- You have to ask for Stafford loans every year and in time this leads to multiple payments and loans that will affect your post-graduation life.
- You will only direct the use of the funds because they are processed and collected only by the school for your lab fees, books, tuition, etc.
BY:Ricky Lim
1.2.09
College Loan Consolidation Made Easy
For most of you who made have attended college already, you can probably confirm the fact that most students can build up quite a debt throughout the years they spend getting educated. This can cause stress, this can even sometimes affect children while they are in college. Their is more pressure for them to succeed and they have this cloud hanging over their head, this huge hole that they need to dig themselves out of.
After graduation, usually about six months after, they want their money back. It's time to start making payments. A college loan consolidation can can help put some ease to those payments, and put less stress on both you and your bank account.
There are many companies and banks that offer college loan consolidations, the basic idea is to take all the loans that you have accumulated and convert them into one, financially feasible payment that you make on a recurring basis. As you look for a company that will consolidate your college loans, you need to be aware that they all have a different method of doing business. They have different interest rates above all else. All these little factors should be carefully considered when deciding on which loan consolidation to accept.
The consolidated loan will give you one key benefit, and that is that you will only pay an interest charge once per month. The interest rate is usually around 4%, whereas at the end of your grace period out of college, it usually sets at almost double that, an average of 7%.
BY:Chris Wilson
After graduation, usually about six months after, they want their money back. It's time to start making payments. A college loan consolidation can can help put some ease to those payments, and put less stress on both you and your bank account.
There are many companies and banks that offer college loan consolidations, the basic idea is to take all the loans that you have accumulated and convert them into one, financially feasible payment that you make on a recurring basis. As you look for a company that will consolidate your college loans, you need to be aware that they all have a different method of doing business. They have different interest rates above all else. All these little factors should be carefully considered when deciding on which loan consolidation to accept.
The consolidated loan will give you one key benefit, and that is that you will only pay an interest charge once per month. The interest rate is usually around 4%, whereas at the end of your grace period out of college, it usually sets at almost double that, an average of 7%.
BY:Chris Wilson
31.1.09
College Loan Consolidation - An Understanding
The majority of college students accumulate quite a debt throughout their time spent in college. The average student, after a 4-year term, has accumulated over $40,000 in debt before he/she has ever worked for their first paycheck. This can be downright daunting to a lot of students.
Most students who are still in high school will apply to any college they fancy. Most don't take into consideration how much it would cost to go to said school if they are actually accepted. This also can create a problematic scenario for the parent, because the child has obviously put forth enough effort to be accepted into a major university, and at times the parent feels like they are obligated to send them to that particular university since their child worked so hard to achieve it.
The Stafford Loan is a low interest-rate loan that is borrowed under the students name. There is no credit check for this loan and co-signers are not required. The funds for this loan come from private lenders and are guaranteed by the federal government. Generally speaking, federal loans are easier to acquire.
Very few families, though, can afford to pay for their child to attend a university unless they are able to get some form a financial aid, be it a scholarship, grant, or loan. All this, for most students, can be very very stressful. Financial management is not always an easy task.
The Federal Stafford Loan, available to undergraduates and graduate students, Is probably one of the easiest ways you could pay for school. No credit check is required and there are no fees (in fact, the government prohibits lenders from charging fees).
BY:Chris Wilson
Most students who are still in high school will apply to any college they fancy. Most don't take into consideration how much it would cost to go to said school if they are actually accepted. This also can create a problematic scenario for the parent, because the child has obviously put forth enough effort to be accepted into a major university, and at times the parent feels like they are obligated to send them to that particular university since their child worked so hard to achieve it.
The Stafford Loan is a low interest-rate loan that is borrowed under the students name. There is no credit check for this loan and co-signers are not required. The funds for this loan come from private lenders and are guaranteed by the federal government. Generally speaking, federal loans are easier to acquire.
Very few families, though, can afford to pay for their child to attend a university unless they are able to get some form a financial aid, be it a scholarship, grant, or loan. All this, for most students, can be very very stressful. Financial management is not always an easy task.
The Federal Stafford Loan, available to undergraduates and graduate students, Is probably one of the easiest ways you could pay for school. No credit check is required and there are no fees (in fact, the government prohibits lenders from charging fees).
BY:Chris Wilson
Canadian Student Loan Consolidation
As recently as January 21, 2009, CTV News reported that "Canadians who have pursued post-secondary studies now owe the federal government $13 billion in outstanding loans, according to new figures from the Canadian Federation of Students.
The CFS says Canada Student Loan debt increases by $1.2 million per day and will cross the $13 billion mark on Wednesday."
CFS national chairperson Katherine Giroux-Bougard told CTV that "the government must do more to help stem the growing levels of Canadian student debt." She added, "What the priority of the government should be is really to make post-secondary education affordable," she said.
Now the scary part is that all we keep focused on is longer finance terms. Here's my simple thinking: Why doesn't the government offer companies who hire these debt-laden students, a specific tax break. As part of the hiring process, companies could assume part or all of the student debt. The companies are after all the ones who gain the most in hiring these highly educated people. They should play a role in the debt financing as well. We used to fund apprentice programs remember or am I showing my age? Don't answer that.
It solves many issues. Instead of the government just backing loans and extending payment terms, let's transfer the debt to the companies who benefit the most, through a specific tax break. It will essentially free up government from backing loans, and free the student from a rather unrealistic debt. Now I realize this just seems too easy, but then again, we really seem to always make it more complicated that it has to be.
Some employers still assert that they like their employees to be in debt, that means they need their job more. This of course is old fashioned moronic thinking! More modern companies want to see their employees flourish and enjoy the good things life has to offer versus having to have a night job and work weekends just to barely keep up. A happy employee becomes an inspired worker who gives and achieves more. But this is reserved for the very special few employers who look at their employees through a holistic looking glass and not some tired old sweat shop mentality.
Okay have I stepped over the line here? Well at least it got you thinking. Whether you agree or not, I think you will concur that we simply can not lose sight of what these students mean to our future.
You know $13 billion in student loans is only the tip of the iceberg. Look at the transfer payments that provincial governments already give to post secondary institutions. The U of T alone gets almost a billion a year, from the province of Ontario to offset their tuition costs. And these huge transfer payments happen every year!
And what happened at York University recently is just unconscionable! Students held at ransom, they seem to be the only one's with no real voice in all this. Well that's my rant on the subject. I know nothing much will change and students will continue to be stuck with these massive debts.
BY:Mike Perras
The CFS says Canada Student Loan debt increases by $1.2 million per day and will cross the $13 billion mark on Wednesday."
CFS national chairperson Katherine Giroux-Bougard told CTV that "the government must do more to help stem the growing levels of Canadian student debt." She added, "What the priority of the government should be is really to make post-secondary education affordable," she said.
Now the scary part is that all we keep focused on is longer finance terms. Here's my simple thinking: Why doesn't the government offer companies who hire these debt-laden students, a specific tax break. As part of the hiring process, companies could assume part or all of the student debt. The companies are after all the ones who gain the most in hiring these highly educated people. They should play a role in the debt financing as well. We used to fund apprentice programs remember or am I showing my age? Don't answer that.
It solves many issues. Instead of the government just backing loans and extending payment terms, let's transfer the debt to the companies who benefit the most, through a specific tax break. It will essentially free up government from backing loans, and free the student from a rather unrealistic debt. Now I realize this just seems too easy, but then again, we really seem to always make it more complicated that it has to be.
Some employers still assert that they like their employees to be in debt, that means they need their job more. This of course is old fashioned moronic thinking! More modern companies want to see their employees flourish and enjoy the good things life has to offer versus having to have a night job and work weekends just to barely keep up. A happy employee becomes an inspired worker who gives and achieves more. But this is reserved for the very special few employers who look at their employees through a holistic looking glass and not some tired old sweat shop mentality.
Okay have I stepped over the line here? Well at least it got you thinking. Whether you agree or not, I think you will concur that we simply can not lose sight of what these students mean to our future.
You know $13 billion in student loans is only the tip of the iceberg. Look at the transfer payments that provincial governments already give to post secondary institutions. The U of T alone gets almost a billion a year, from the province of Ontario to offset their tuition costs. And these huge transfer payments happen every year!
And what happened at York University recently is just unconscionable! Students held at ransom, they seem to be the only one's with no real voice in all this. Well that's my rant on the subject. I know nothing much will change and students will continue to be stuck with these massive debts.
BY:Mike Perras
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