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Federal Direct Loan Programs
Federal Direct Loan programs have been around since the 1950’s, and were initially created to help students pay for college. The government offers loans based on need and income levels. There are three programs in total including; Stafford loan, PLUS loan, and Perkins loan. The interest rates vary from year to year, however, if you qualify for any federal grant program, then you will not be charged interest while you are enrolled in school. Federal direct loans are paid back over a period of 10 years, and they do not count towards financial aid. If you choose to make payments, then you will end up paying less money than what you would have paid had you borrowed directly from a bank. As long as you keep making your monthly payments, the amount owed won’t increase from month to month. These types of loans are excellent for students who don’t anticipate being employed after graduation, or those who have bad credit. Additionally, these loans offer low-interest rates, thus lowering the monthly payments.
Parental loans work just like federal direct loans, except instead of borrowing money from the United States Department of Education, you borrow money from friends and family members. You can only get parental loans if you apply before turning 18, and you will receive a higher limit if you take out a consolidation loan. You may want to consider taking out a consolidation loan if you expect to graduate university, and still plan to live at home. Consolidating your loans means that you will pay less in interest rates while you finish high school and then start repaying your debt right away. You can also opt to extend the length of time you repay the loan, and you will not accrue any additional costs. However, some people decide to stop making payments, and they default on their loans. After 6 months of nonpayment, the loan automatically goes into collection, and the lender can pursue legal action against you.
Private Student Loans
Private student loans are similar to private commercial loans, except they are offered by banks and credit unions instead of a corporation. This type of loan works best for students who already have good credit scores, or who are going to earn a large sum of money after graduation (i.e., doctors, lawyers, etc.). Like federal direct loans, private loans have fixed interest rates, however, the repayment terms aren’t set in stone. Your lender may ask you to pay monthly payments, or you may be given a lump sum payment depending on how much you owe. To avoid prepayment penalties, you should pay off your loan in full each semester. If you fail to do this, then you could lose a substantial amount of interest.
College Education FinancialAid
How College Funding Works
In today’s economy, finding ways to raise money is often hard enough. How exactly does a potential student go about doing so? Let’s take a look at the process.
The Application Process
When you first consider applying to a college, you’re embarking on a journey where you point yourself toward a certain location. Many schools offer scholarships. These are sometimes called “free money,” and they really are; the government either takes care of the whole thing or offers something that helps fund school. So how does that happen?
First, you would fill out an application. Applications are relatively simple and allow colleges to zero in on students they might want to attend class more frequently. In many cases, a professor will recommend applicants whose grades suggest they might succeed academically. Beyond academic merit, the application also asks questions pertaining to extracurricular activities and personal statements about goals and aspirations.
With applications done, the next step is waiting. Most universities require that you wait until early March to hear whether or not you’ve been accepted. Now what happens at this stage? At this point in the game, universities begin accepting things like tuition and fees. This means that you’ll need to figure out funding options, especially if you’re trying to study abroad.
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Private Education Loan
Private education loans are designed specifically for college students who need additional funding for their school expenses. Many loans have an interest rate as low as 4% APR (Annual Percentage Rate) making them an attractive option. Private lenders offer many different types of loan programs including fixed-rate, variable-rate, and even some non-traditional options.
Federal Direct Student Loan
The federal government offers four popular student loan choices: direct subsidized loans, direct unsubsidized loans, parent loans, and consolidation loans. All students should take advantage of these programs since they provide lower rates than private education loans. However, borrowers should choose carefully before applying for any type of loan. Make sure you understand what repayment terms you qualify for and how much money you will need each month to pay back your loan.
Stafford loans originated under the William D. Ford Federal Direct Loan Program are offered at competitive rates and are federally guaranteed. Borrowers may use Stafford loans to help cover tuition costs, books, supplies, computers, and anything else related to their schooling. Repayment begins six months after graduation and lasts 10 years; however, you may be able to get an earlier deferment.
Parent Plus Loan
Parents Plus loans consolidate multiple federal and state loans into one program. Parents plus loans are often recommended if parents already hold student loans from banks, credit unions, and other financial institutions, or if parents are not willing to borrow more money. Parents may receive payments directly from their children’s schools and then forward those funds to the original lender to cover the balance.
Government grants are offered by various educational agencies and may be awarded based on financial need. These funds are free money given out by the government to assist eligible individuals. A list of grant opportunities is available online at www.fafsa.ed.gov.
Work study programs are funded by the Department of Labor and administered by colleges and universities. Students work for campus organizations like student governments, counseling centers, athletic departments, and others while completing academic coursework. Most work study jobs require little to no experience and pay between $1,000-$6,000 per year depending on location and position.
Scholarships are forms of cash assistance provided by donors to needy people. Student loans are forms of financing in which the federal government gives money directly to students rather than lending it to their parents as in the case of parental loans. Both scholarships and student loans require careful consideration because they both have high application fees and income requirements in order to qualify.
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Student Loan Consolidation
Student loan consolidation is the act of getting many different private student loans into a single, lower interest rate. Usually, the best option is to consolidate federal loans first (such as direct subsidized Stafford loans) and then work from there. You’ll find consolidation options at banks and credit unions, as well as online lenders such as LendingTree.com.
Home Purchase / Refinance Mortgage
A home purchase mortgage or refinance mortgage refers to a loan taken out to buy a house or to finance already existing debt owed on a primary residence. These two kinds of mortgages have some similar features, including fixed rates, fixed monthly payments, and fixed terms. However, they differ slightly in how much down payment money is required, what kind of property insurance may be needed, and whether any fees or points will be charged.
Small Business Loans
A small business loan is a type of bank loan designed specifically to fund the capital investment requirements of small businesses. A small business owner will need to file personal income tax returns, offer financial statements, pay a deposit and provide collateral (like real estate or equipment) before receiving approval for a loan. Lenders generally prefer borrowers who demonstrate consistent cash flow over several years. Once approved, borrowers have 30 days to close the loan. If the loan is not closed within 30 days, additional penalties apply.
Personal Line Of Credit
A personal line of credit is a revolving loan that is paid back in increments instead of making one lump sum payment. Unlike traditional installment loans, these types of loans are offered to consumers under $25,000, and are often used for unexpected expenses or purchases that aren’t always easily budgeted for. The borrower can use the funds at his or her discretion without having to wait until the entire balance is repaid. Interest is calculated daily, unlike typical installment loans where interest is added onto the full amount borrowed each month. In addition, borrowers can incur fees if they draw amounts exceeding their approved limits.
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Federal Direct Loan
This type of loan is offered through the federal government’s student lending program. As long as you have good credit and meet basic requirements, you could qualify for these loans.
The Department of Education offers Perkins Loans. Eligibility requirements depend on whether you go back to school full-time or not. If you do not, then you may be able to borrow money if you complete 120 hours of community service. However, borrowers who go back to school full time need to maintain at least half-time enrollment and have a cumulative GPA of 2.0 or higher before they apply.
Parental PLUS Loan
If you want to take out a private loan to pay for college, you might consider getting a parental PLUS loan. You would then add any additional funds to your loan repayment plan. Your parent would repay the loan directly if you graduate within 10 years, or contribute to your education after you graduate.
Bursars are loans given directly by colleges to students who show financial need. Generally, bursar loans offer lower interest rates than most other types of loans. However, you must agree to attend school and live in a certain area. Additionally, you must work while attending college, unless you qualify under the William D. Ford Federal Direct Loan Program.
National Defense Student Loan
For active military members, you might want to look into taking out a national defense student loan. There are many benefits to this type of loan, including eligibility for forgiveness programs upon discharge.
Pell Grants are awarded by the U.S. Department of Education based on financial need. Eligible applicants must enroll and attend school regularly to receive them. To be eligible, you must have a high school diploma or GED, be enrolled in a degree or certificate program (such as vocational school), and demonstrate financial need.
State grants vary depending on your state of residence. These grants are generally awarded to students whose families earn less than $65,000 per year.
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Federal Student Loan
The federal student loan program gives students assistance with paying for college while they study to receive their degree. This type of loan should only be utilized if other loans do not work out for you.
A payday loan is a short-term small dollar loan that is designed to help you deal with temporary financial difficulties. There are different types of payday loans including online payday loans, mobile application payday loans, and cash advance payday loans. You need to make sure you pay back these loans before the due date. You can apply for a payday loan on our website.
You might have heard about car loans; however, people don’t understand how they work until they get involved in getting one. A car loan comes in handy whenever you need money right away. However, there are some instances where you cannot use this kind of loan. If you think you qualify for a car loan then contact us today!
Personal Line Of Credit
If you want to borrow money without having to wait for your bank account to clear, personal line of credit may be what you are looking for. In order to apply for a personal line of credit, you have to meet certain criteria listed below:
You must own real property (land) and/or have ownership of a home or business
Your monthly income must be at least $1000 per month
There must be no outstanding debts to any banks, creditors, collection agencies, etc.
In order to qualify for a personal line of credits, your total debt must fall under $10,000.00
Small Business Administration Loans
Small businesses often encounter challenges when trying to secure financing. A SBA loan is a government backed loan that you can take advantage of to fund the start-up costs associated with starting your own business. Many entrepreneurs choose to utilize this option because it does not require collateral and the terms are flexible.
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