School Loan Consolidation Information

School loan consolidation program suspended

2008-05-01T10:43:00.000-07:00

Here's a good article regarding the national crisis with School Loan Consolidation.

School loan consolidation program suspended

Problems in national financial markets get much of blame

By CHARLES S. JOHNSON
Gazette State Bureau

HELENA - In another major cost-cutting step this month that will affect students borrowing money to attend college, the Montana Higher Education Student Assistance Corp.'s board of directors voted Wednesday to suspend its federal student loan consolidation program.

Since it began offering these federal student loan consolidations in 1995, MHESAC said it had provided more than $790 million in consolidation loans to 49,000 Montanans. These allowed these Montanans to effectively manage their student loan repayments by locking in their student loan interest rates at their then-current interest rate for up to 30 years. Some interest rates were as low as 2.85 percent.

Those student loan consolidation requests already submitted will be completed, but no new ones will be accepted, said Jim Stipcich, president and chief executive officer of the Student Assistance Corp., a nonprofit group that serves as MHESAC's business manager.

MHESAC anticipated that it would have done $45 million worth of consolidation loans this year. Suspending these $45 million worth of loans will save MHESAC $6 million over the life of these loans, Stipcich said in a telephone interview.

"As part of our ongoing commitment to Montana students and borrowers, our loan education counselors will be available to work with them to find another provider of federal consolidation loans," Stipcich said in a press release.

However, he said later that across the country, most lenders are not offering consolidation loans. These loans are still available under the federal direct loan program in which students apply directly through the federal government.

About 15 percent of Montana students use the federal direct program, while the remaining 85 percent use MHESAC.

Stipcich said extended repayment plans on student loans may help some borrowers instead of student loan consolidation. These plans will reduce monthly payments and spread them out over a 20-year term.

MHESAC Chairman Fred Flanders of Helena said a variety of factors led the board to suspend the loan consolidation program. The most significant, he said, were changes in lender yields authorized by Congress in October 2007 and the disruption in national financial markets.

"In the current climate within the student loan industry, providing FFELP (Federal Family Education Loan Program) consolidation loan products is just not economically viable," Flanders said. "While student loan consolidation still provides benefits for borrowers who already have student loans, MHESAC believes it's crucial at this time to concentrate on ensuring that Montana students have access to funding for their postsecondary education."

Flanders said MHESAC wants to assure Montanans that it remains focused on helping students "attain their dreams of higher education."

"In addition, we will continue to work closely with our partners in the industry and Congress to identify an effective solution to the challengers facing the federal student loan industry at this difficult time," he said.

Last week, MHESAC announced that it faced its first operating loss in history. The credit and liquidity crisis on Wall Street has increased MHESAC borrowing costs on its outstanding financings by more than $14 million over the past nine months, Stipcich said.

Flanders said MHESAC has secured funding for Montanans for federal student loans for the 2008-09 academic year. The amount available is $175 million.

Asked about the availability of student loans for Montanans in future years beyond 2008-09, Stipcich said in an interview on April 15, "At this point, we don't know if could access the markets to raise funds for future years."

On April 14, MHESAC announced that it was reducing benefits to future student loan borrowers by $3 million and telling SAF to eliminate any unnecessary expenses. It reduced "borrower benefits," which Stipcich said means that students no longer can count on MHESAC to pay the borrower origination fee and default fee on their student loans on their behalf as it has in the past. It amounts to 2 percent.

In the past, students getting MHESAC loans received 2 percent more in loan proceeds than they will in the future. For example, if a student borrowed $15,000, the person would get the full $15,000 in loan proceeds because MHESAC paid the 2 percent origination and default fees, which amount to $300 in this example.

Starting this fall, however, a student borrowing $15,000 will receive $14,700 in loan proceeds because the student, not MHESAC, must pay the 2 percent origination and default fees, which come off the top of the loan proceed amount.

In addition, the Student Assistance Foundation has shrunk its staff by 35 employees through attrition, Stipcich said. It now has 233 employees.

"Everything is on the table," Stipcich said.

Published on Thursday, April 24, 2008.
Last modified on 4/24/2008 at 12:30 am

Nationwide Home Mortgage Loan Company Information

2008-01-07T14:53:00.000-08:00

Nationwide Home Mortgage Loan Company is one of the leasing home mortgage lenders in the United States. Nationwide Advantage Mortgage offers a variety of home loans to suit every down payment size and most income levels. They offer fixed rate mortgages, adjustable rate mortgages (ARMs), balloons and jumbo loans. Look at the table below to help you decide what type of home loan is right for you.

ou want...	You plan to...	You can handle...	You may want to consider...
A stable interest rate and a principal and interest payment that won’t change	Stay in your home for many years	A rate that won’t change over the term of your loan	Fixed Mortgage
A lower introductory interest rate	Stay in your home for 3 to 10 years	The risk of increased payments	Adjustable Rate Mortgage
A lower short-term, fixed interest rate	Sell or refinance prior to term expiration	A large, lump-sum final payment at term expiration	Balloon Mortgage
A loan amount that is above the $417,000 conventional loan limit	Buy or refinance a residence, vacation home or investment property that is above $417,000.	A higher interest rate	Jumbo Mortgage

table and information can be found at www.nationwide.com

More information on loans and school loan consolidation can be found at www.SchoolLoanInfo.com

How Can I Consolidate My School Loan Debt.

2008-01-07T13:01:00.000-08:00

There are many resources available to help students and parents with school loan debt consolidation. For more information on this visit www.SchoolLoanInfo.com.

Reasons for consolidating your current school loans will vary from one person to the next, but these are just a few of the benefits you will receive when doing a school loan consolidation.

Lower Monthly Payment
Single Payment to one lender
Fixed Interest Rates
Continued or new deferred payments

In most instances, you will be able to choose which loans you want to include in your loan consolidation and not only will you get a lower, fixed interest rate, but you can lengthen your repayment time, thus lowering your monthly payment and reducing your debt stress.

If you currently have multiple student loans, and are considering rolling them into one consolidation loan, be sure to check the current interest rates on each of your individual loans and decide which loans you want to include in the consolidation based on those interest rates. If you already have loans with a low, fixed interest rate, you will want to exclude these loans from being included in your consolidation loan, as you will most likely end up with a higher rate and payment than you currently have.

Visit School Loan Consolidation Resources if you need further information

Free Money for College and How to Find It

2007-12-19T11:15:00.000-08:00

Making college affordable is the goal of many families. Unless you are independently wealthy, most families will have to find some way to pay for tuition, housing, and all the other expenses associated with attending university. Finding free money for college is every family’s goal. Here are some tips for finding it.

The FAFSA = Let Uncle Sam Help You Find the Free Money

Every family looking for free money for college should fill out the FAFSA. The FAFSA-the Free Application for Federal Student Aid should indeed be your first step to tracking down the free money. Lower income families may qualify for a Pell Grant. A Pell Grant is money given to college students that does not have to be paid back. In recent years, the Federal government has gradually reduced the amount of Pell Grants that are made available each fiscal year, but they are still there. Who qualifies for a Pell Grant? The federal government uses a formula to determine who qualifies for a Pell Grant.

A student’s Student Aid Report will show any Pell Grant awards, and funds are usually distributed during the first week of school. If you do not qualify for a Pell Grant, you will probably be offered either an unsubsidized student loan or a subsidized student loan. While these are technically not free money sources, a subsidized student loan can be a good way to get the funding you need at a reasonable interest rate.

Riding the Full Tuition Scholarship Wave

No one ever said that finding free money for college would be easy. Indeed, finding the free money can be a full time job. Fortunately, there are many helpful guides out there that can help families track down suitable scholarships. The most highly sought after scholarships are those that will cover tuition. These are usually paid directly by the college or university. Many state schools offer full tuition scholarships to high school graduates graduating in the top percentage of their class, as well as full tuition scholarships for students transferring to a state university from a local community college. Contact prospective college and university financial aid offices for more information about their full tuition scholarships. In most cases, you will have to demonstrate satisfactory academic progress in order to retain or renew your scholarship.

A Scholarship for Everyone - Hunting Down the Free Money

If you are not able to get a full tuition scholarship, you are not alone. Fortunately, there is a world of specialty scholarships out there that offer financial assistance for prospective college students. Visit your local bookstore or library to find a compendium of scholarships. You will find that there is free money for college available not just for ‘straight A’ students, but to anyone who is willing to look for them. There are scholarships available for students from a certain background (African-American, Irish-American, etc.), who are entering a specific field of study (Journalism majors, Accountants, Artists, etc.), who have overcome adversity (students who have lived in foster care, etc.), and many more. The monetary value attached to these scholarships can vary widely, from a full tuition scholarship to textbook money.

Contests Winning Your Way to Free College Money

Along with scholarships, there are many contests open to prospective college students or students already enrolled in an accredited college that offer anywhere from a few hundred dollars in prize money to a full tuition scholarship. Take advantage of essay exams, especially those that are open only to certain students. For example, a broadcasting association may hold an essay contest for prospective broadcasting majors only. Our guide, "529 Savings Plans Exposed" offers guidance on how to win these types of contests.

Free Money for College is brought to you by http://529savingsplansexposed.com/free-money-for-college.html where you can find additional resources for financing your education along with the book "529 College Savings Plans Exposed!"

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Visit School Loan Consolidation Facts for more information

School Loans - Need Based vs Non-Need Based Loans

2007-12-05T14:55:00.000-08:00

If you are thinking about applying for a new school loan or consolidating your current school loans now that you have graduated, the information provided in this article should help you determine which loan you will need and the terms and conditions of the various loans.

Generally, student loans are categorized into either need base loans or non-need based loans, and there are federal and private loans available which fit into both of those categories.

Features of Need Based Loans:

1. Lower Interest Rates: The federal government is the main provider of need loans. The Stafford loan is the most popular need based loan which is a fixed interest rate loan of 6.8 percent. The Perkins loan has a rate of 5 percent.

2. Delayed Repayment: Need based federal loans do not require you to repay the principal loan until after you graduate or leave school. This is a deferred payment loan.

3. Interest Subsidization: As interest accrues on the loan, the government will pay this interest while you are in school and for up to 6 months after graduation.

Features of Non-Need Based Loans: Non-Need based loans are for students and their families who cannot afford to pay 100 percent of the college tuition and costs, but do not qualify for need based loans due to their income level. Non-need based loans typically have a higher interest rate, have no in-school interest subsidy and may require immediate repayment of principal.

There are four main types of School Loans that you need to know about;

Perkins Loans are need-based loans and are awarded by the financial aid office to students with the highest need. The interest rate is very low-5 percent-and you don't make any loan payments while in school.

Subsidized Stafford Loans are need-based loans with a fixed interest rate of 6.8 percent. With subsidized loans the federal government pays the yearly interest while you're in school.

Unsubsidized Stafford Loans aren't based on financial need and can be used to help pay the family share of costs. You're responsible for paying interest on the loan while in school. You may choose to capitalize the interest. The advantage of doing this is that no interest payments are required. The disadvantage is that the interest is added to the loan, meaning that you will repay more money to the lender.

Grad PLUS loans are student loans for graduate students sponsored by the federal government that are unrelated to need. Generally, students can borrow up to the total cost of education, minus any aid received. The advantage of this loan is that it allows for greater borrowing capacity. However, students should consider lower-interest loans, such as the Subsidized Stafford or Unsubsidized loans prior to taking out a Grad PLUS loan.

You can read more about federal and private loans that are incorporated into the need and non-need categories at our website listed below.

School Loan Consolidation

Useful Links:
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When to consolidate your School Loans!

2007-11-26T16:12:00.001-08:00

Lot's of people with school loans aren't quite sure when they should consolidate. These tips will help you decide on the right time for your situation.

There are no deadlines in the Federal Consolidation Loan program. There are several things to keep in mind, however, regarding when to do a school loan consolidation. Your loans must be fully disbursed to be eligible for a Federal Consolidation Loan. They also must be in their grace period or in repayment.

It is best for you to consolidate while your Federal Stafford Loans are still in their grace period, when they still have the lower in-school interest rate.

If you are consolidating your federal student loans during your grace period but are worried about losing your grace period, section D on the Federal Consolidation Loan application includes a question that allows you to enter your grace period end date. If a date is provided in this question, the lender won’t complete processing of the application or fund the loan until near that date. So you can apply for the consolidation loan at any time during your Federal Stafford Loan grace period, qualify for the lower in-school interest rate, and postpone the start of repayment on the debt until near the end of your grace period.

The longer you postpone funding of your Federal Consolidation Loan, however, the more interest will accrue on any unsubsidized Federal Stafford Loans (or any other federal student loans for which you are responsible for the interest) that are included in your Federal Consolidation Loan. You should also know that, while funding of your Federal Consolidation Loan is pending, interest may accrue on your Federal Stafford Loans at a different rate than the rate used to calculate your Federal Consolidation Loan interest rate.

If your loans are already in repayment, federal student loan consolidation may still be beneficial. It allows you to fix the interest rate on your federal student loans while rates are still low.

For more information...visit our website at Student Loan Debt Consolidation

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Applying for a School Loan? What you need to know about FAFSA

2007-11-19T17:10:00.000-08:00

If you're a prospective college student and you are in need of a school loan, a Federal student loan is a good option. In order to get approved for federal financial aid you will need to complete the FAFSA. FAFSA is the acronym for “Free Application for Federal Student Aid.” Applying for Financial Aid is free and you can apply online a www.fafsa.ed.gov . Complete and submit a Free Application for Federal Student Aid which is the basis for all financial aid. Students can begin submitting their FAFSA on January 1. Here are some frequently asked questions regarding FAFSA and federal financial aid.

How do I apply for financial aid?
A FAFSA is all you need to get started.

What is FAFSA?
Free Application for Federal Student Aid. It’s FREE!!

Do I have to fill out a FAFSA every year?
Yes. Applications are available starting January 1^st, both paper and electronic applications.

What is the difference between submitting an electronic FAFSA versus a paper FAFSA?
An electronic FAFSA is processed in two (2) to three (3) weeks, while the paper FAFSA takes four (4) to six (6) weeks to process.

What is the deadline for filing the FAFSA (i.e. applying for financial aid)?

The PRIORITY deadline for FAFSA is March 2^nd. Forms must be postmarked no later than March 2^nd before the academic year for which aid is being sought in order to be considered for STATE aid. However, if the March 2^nd deadline is missed, you will still be considered for federal Financial Aid, as well as other Financial Aid programs.

You can apply for a Financial Aid through the last day of classes in Spring semester.

How is the FAFSA used to determine my financial aid need?
The federal government uses data provided on the FAFSA to calculate a student’s Expected Family Contribution (EFC). The Financial Aid Office calculates a student’s Cost of Attendance (COA) which includes tuition, living expenses, miscellaneous fees, books, etc. COA minus EFC equals a student’s financial need, which we then try to meet with federal grants, state grants, academic or talent scholarships, institutional grants, federal work study, and various loans.

Some of the above information can be found at http://financialaid.fullcoll.edu/Frequently%20Asked%20Questions.htm
Get more information @ School Loan Consolidation

Top Financial Mistakes Made by College Students.

2007-11-14T15:15:00.001-08:00

1. Blowing your student loan money!
Instead of using your financial aid for books, tuition, room & board, many students will choose to finance their extravagant lifestyle of partying, clothes, gadgets, and eating out. These school loans you've worked so hard to get should be paying for your education, not you social life...so use the money wisely. You'll be paying them off for many years to come.

2. Credit Card Debt!
Even responsible adults can rack up some hefty credit card debt, but students, who have no viable income besides their school loan money, and what cash mom & dad give them, have no business getting multiple credit cards. This is a recipe for credit disaster, because now students will not only have their school loans to repay when they graduate, but large credit card balances. Nellie May, the largest student loan maker, says that most graduate students have an average of $5800 in credit card debt.

3. Not Paying Your Bills on Time!
Racking up huge credit debt and not paying your bills on time is a good way to ensure that you can't purchase a car, rent an apartment or even get a cell phone after you graduate. Keep the credit cards to a minimum, and pay your bills on time to keep your good credit rating. You'll thank yourself in a few years.

4. Bad Budgeting!
Being a college student generally means living on a fixed income. Weather it be your financial aid money or money from a part-time job, or even money from Mom & Dad, the cash is usually limited and setting up a budget is important. A monthly budget doesn't mean you can't do the things you want to do, but simply a plan so you know the "must-pays" actually get paid. Figure out exactly what bills and expenses you have every month and plan for those first. Any money after that you can budget for social / recreational items like CD's and kegs.

5. Going to a College that's too Pricey!
Instead of going to your local community college for your pre-req classes and spending $25 a unit, many students feel they have to go to the 4 year university straight out of high school. Many end up returning home and going to a C.C. anyway, but attending a local school first is a good way to save money, and get those required classes out of the way cheap. After you've completed these courses, transfer to a 4 year school to complete your undergraduate degree. This will save thousands upon thousands of dollars that you would have racked up on student loans, and been paying off well into your 30's.

So many bad financial decisions students make is a result of poor financial education. Students haven't been taught by their parents or high school teachers the importance of maintaining a good credit score, paying bills on time, and budgeting income. Wise spending during the college years will ensure that the money you make after graduating will be spent on things you want, not credit card payments, collection companies and school loans.

To get more information on School Loan Consolidation and ways to lower your student loan payment, visit http://www.SchoolLoanInfo.com

What you should know about school loan debt consolidation.

2007-11-13T16:28:00.000-08:00

What is Student Loan Consolidation?

Consolidation Loans combine several student or parent loans into one bigger loan from a single lender, which is then used to pay off the balances on the other loans. It is very similar to refinancing a mortgage. Consolidation loans are available for most federal loans...including FFELP (Stafford, PLUS and SLS), FISL, Perkins, Health Professional Student Loans, NSL, HEAL, Guaranteed Student Loans and Direct loans. Some lenders offer private consolidation loans for private education loans as well. School Loan consolidation is among the most important and advantageous financial decisions recent graduates and former students can make.

Why Do Most Students Consolidate Their School Loans?

- To lower monthly payment amounts by up to 45%

- To give them an opportunity to build their credit rating

- To make only one student loan payment each month

The Scoop on School Loan Consolidation Discounts.

Why Lenders Offer Loan Discounts.

The Higher Education Act of 1965 sets the maximum interest rates and fees on student loans. This helps protect loan gouging by student loan lenders, making access to student loans relatively easy for those who are in need of financial aid. Nothing, however, prevents a lender from charging lower interest rates and fees. (The illegal inducements regulations prevent lenders from providing immediate rebates, which would be similar to paying borrowers for their loans. However, most lenders work around these restrictions by instituting a one month delay in rebate discounts, or by providing the discounts when the loan enters repayment)

Lenders offer loan discounts for competitive reasons. Originally the competition was with the Direct Loan program. However, with the repeal of the single holder rule, lenders are increasingly competing with each other for the highly profitable student loan market. If you currently have multiple student loans, you should get the proper information regarding consolidation of those loans.

Visit SchoolLoanInfo.com for more information on School Loan Consolidation

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