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Bank of America offers students two types of student loans: subsidized and unsubsidized. Subsidized loans are offered at lower interest rates, making them great options for those who have little-to-no credit history. If you already have good credit, however, then there’s no need to worry about these loans being added to your debt load. Unsubsidized loans allow you to pay back your loan over time, but they’re not guaranteed by the government either. You’ll have to pay interest on top of principal — but if you pay off your balance early, you won’t accrue any additional fees. Both types of loan offer repayment flexibility: you can choose between monthly payments or a lump sum payment. Either way, you can always apply for refinancing to change your terms.
How to get started:
Apply online and start saving! Find out how much money you could save by switching to Bank of America today.
Payments can be made via direct deposit or through the bank’s mobile app. If you opt for the latter option, you can set up automatic withdrawals to put toward your loan. Payments can also be scheduled based on your budgeting needs.
There are no limits on the total amount of money you can borrow. Even if you don’t end up using the entire amount, you may find yourself with extra funds to use toward future education costs.
Bank of America may also offer other financial aid programs, including Parent PLUS loans and private educational loans. These programs aren’t associated with federal grants, but they do provide low-interest financing to those enrolled in higher education.
Student Loans From Bank Of America
How many people have student loans?
You might think that everyone has student loans, but if you want to get a sense of how big this problem really is, just look at how many students actually graduate each year without debt. In 2009, only about one-third (34%) of college freshmen graduating attended school with $0 in federal loans, according to data from the National Postsecondary Student Aid Study released in May 2010. That same survey showed that the average amount owed by these graduates was $24,100, though the total number of borrowers increased dramatically over time. What’s worse, some colleges charge tuition prices higher than ever before, making education even less affordable for low-income families.
Is my loan dischargeable? Does it affect bankruptcy?
In short, no. Your student loans are not discharged in bankruptcy unless they were accrued while filing for Chapter 13 protection, meaning that you could have paid off your loans completely and still had them hanging around when filed for personal bankruptcy. But you don’t need to worry about it affecting your credit rating—unless you defaulted on your payments. You’ll likely find your FICO scores fall after you file for bankruptcy, but they should start to recover once you make your last payment.
Am I eligible for any programs through my bank?
Yes! Many banks offer special interest rates to qualified borrowers who take advantage of their financial aid options. Here are a few good ones:
Bank of America offers two types of low fixed rate loans: Federal Direct Consolidation Loan and Private Label Funding. Both provide long-term financing for 12 months. Interest is calculated based on the prime plus.25% per annum. A borrower with a BofA Direct Consolidation Loan may qualify for Federal Direct Consolidation Loans. Private Label Funding enables a borrower to borrow directly through his or her own private label account or a third party commercial lender’s private label account. A borrower may receive a tax deduction for the interest portion of the consolidation loan.
Citibank offers a program called “The New College Promise” that provides low fixed rate financing for 12 months. This benefit is open to both undergraduate and postgraduate students. Interest is calculated using the Prime Rate plus 1.50%. A borrower may receive a federal income tax credit for the interest portion of this loan.
Capital One offers a lower interest rate for its private label lending program, known as “College Advantage.” It also offers a longer repayment period as well as a special APR adjustment for graduates enrolled full-time.
Chase offers two programs that allow qualifying borrowers to refinance their current student loans. These refinancing programs apply to both undergraduate and graduate borrowers. Chase’s Refi Plus Program allows borrowers to prepay their original loan balance and receive a refund. This eliminates interest charges while reducing their monthly payment. The program is available to undergraduate and graduate borrowers with outstanding balances of $10,000 or less. Chase’s Loan Optimization Program allows borrowers to consolidate their existing student loans under one monthly payment plan.
Sallie Mae Offers a unique program called Sallie Mae Pay As You Earn (PAYE) that combines the benefits of a subsidized Stafford loan with those of a PLUS loan. Under this program, borrowers pay a set percentage of their discretionary income toward their loan payment for five years. If you complete the five-year grace period without having repaid your loan, you are then responsible for paying 100 percent of your remaining loan balance. Income eligibility varies depending on whether you are borrowing money for undergraduate or graduate study. Eligibility requirements also vary based on whether you are borrowing privately or federally.
Wells Fargo & Co. offers a program called ‘Depend On Me’ that helps undergraduates with private student loans repay their debts. Borrowers must have outstanding loans of $20,000 or more, have graduated within the past four years, and have received financial assistance with an award letter from Wells Fargo.
Can I use my 401k to finance my student loans?
401(k) plans are funded by ptax dollars so they cannot be used to finance loans incurred outside of work. However, you can withdraw funds from your plan to help cover nonwork expenses. This includes student loans. Most plans will provide a maximum limit on how much money that can be withdrawn per month. Consult your plan documents for details.
Student Loans From Bank Of America
Description: Student loans are probably the biggest financial burden for students attending college today. There are many different types of student loan programs at BofA with varying rates and terms.
Student Loan Consolidation
When you consolidate student loans, you can make them easier to handle. Most consolidation programs require payments over time to pay off the entire loan balance at once. The interest rates on these types of loans are much higher than typical personal loans, and they often have repayment terms that exceed 20 years. By consolidating your student loans, you may pay less interest and save money each month. However, before making any final decisions, talk to the lenders about their specific loan consolidation options. You may find out that certain institutions offer more flexible payment options. Lenders might allow you to spread out your monthly payments over 10 years instead of 12 months. If you get approved, make sure to ask if you qualify for their lower interest rate. A lender’s interest rate could affect how fast you’ll repay your loan.
Private Student Loan Refinancing
If you’ve tried to refinance your private student loan, you may have experienced challenges. Private loan refinancing isn’t always possible, even if you’re eligible. In some cases, refinancing is not allowed. Even if it is allowed, you may not be able to refinance into a lower interest rate. If you do succeed in refinancing, you should still check your interest rates regularly to ensure that the lower rate applies retroactively to the date of origination, regardless of whether or not you choose to accept the new loan term.
Federal Consolidation Programs
The federal government offers several different loan consolidation options. You should explore each option carefully before deciding which one you want to use. These programs vary according to the type of loan and the number of consolidated loans you have. Some programs require consolidation of private student loans while others only apply to federal Stafford loans. Each program includes its own set of pros and cons, so read the information carefully before taking action.
Student Loan Forgiveness
One of the best ways to reduce the amount of debt you owe is by paying down your balance early. Many people don’t realize that you can actually wipe away your remaining loan balance completely if you work long enough and make sufficient payments. If you meet certain requirements, your remaining balances may be forgiven after ten years of payments. Make sure to talk to your lender to learn about the specifics of this program. Also, keep in mind that the loan forgiveness amounts may change each year depending on Congress’ budget priorities.
Income Based Repayment Plans
If you have a low income and high-interest student loans, you might consider enrolling in an income-based repayment plan. Under this plan, you make fixed monthly payments based on your family’s adjusted gross income (as reported on your tax return). Your minimum payment will never go below $0, and you won’t have to start repaying until you reach a specified income threshold, such as a percentage of your discretionary income or a certain dollar amount. You’ll need to complete an application to determine eligibility. Once you are accepted, you will receive a letter telling you what your payment amount will be. Keep in mind that your total loan balance must be repaid within 25 years in order to be eligible for IBR under current regulations.
Student Loans From Bank Of America
Description: “Bank of America has been hit hard after recent scandals and now students are having trouble getting student loans from them, even if they have never had any problems paying back their previous loans.”
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