Student Loans

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					Student Loans
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     www.cccsso.org
  820 Crater Lake Avenue,
         Suite 202
    Medford, OR 97504
       541-779-2273
                          Student Loans
STEP 1:      If you don’t know already, find out what kind of student loans you have.
            The type of loan you have influences the options you have available to you.

Your ability to negotiate with you lender, defer your payments or possibly cancel your loan
may depend on what type of loan you have. You may even have more than one type of
loan. The following are possible types of loans:

Subsidized Direct or FFEL Stafford Loan: Dept of Education pays interest while borrower is in
school and during grace and deferment periods. You must be at least a half-time student.

Unsubsidized Direct or FFEL Stafford Loan: Federal Stafford Loan: Borrower is responsible for in-
terest during the life of the loan. You must be at least a half-time student. Financial need
is not a requirement.

Federal Perkins Loan (formerly National Direct Student Loans): Interest charged on this loan
is 5% for both undergraduate and graduate students; payment is owed to the school that
made the loan.

Direct or FEEL PLUS Loan: Available to parents of dependent undergraduate students who
are enrolled at least halftime.

Other Federal loans      Health Professions Student Loan (HPSL),
                         Health Education Assistance Loan (HEAL)
                         Federal Supplemental Loans for Students
                         Federal Insured Student Loan (FISL)
                         Loans for Disadvantaged Students (LDS)
                         Nursing Student Loans (NSL)

Private Source Loans : may come from school or lender.



STEP 2: Find out who is servicing your student loan. Your options regarding
          your loan and the amount of fees you may owe is determined by what
          agency is currently handling your loan..

•   Information from bill or phone call.
•   If a Federal loan: 1-800-4-FED-AID (800-433-3243, or www.nslds.ed.gov
•   Contact the financial aid department at the school you attended.
•   Contact the original lender.


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STEP 3: Research and review your options.

Depending on your circumstances, you may be able to do the following:

•   Consolidate your loans
      Contact the Direct Loan Origination Center’s Consolidation Department at
      888-557-7392, or visit www.loanconsolidation.ed.gov form more info.

•   Defer your loan - Deferment is a postponement of repayment under specific
      circumstances. You can request a deferment if: you are at least a half
      time student; or you are in a graduate fellowship program or you are in an
      approved rehabilitation training program for the disabled; or you are unable
      to find full time employment; or if repayment would cause you economic
      hardship.
      Deferments are not granted automatically, you must formally request one
      through the procedures your loan holder has established. Interest on certain
      loans is not paid during deferment, but for other loans you are responsible for
      the interest during the deferment. Call the Direct Loan Servicing Center for
      more info: 800-848-0979, or visit www.dl.ed.gov

•   Forbearance - If you can’t meet your repayment schedule but you’re not
      eligible for a deferment, you might be granted forbearance for a limited and
      specified period. During forbearance, your payments are temporarily
      postponed or reduced. You will be charged interest during forbearance. As
      with a deferment, you must formally request a forbearance from you loan
      holder.

•   Loan discharge –In some cases your federal student loan can be discharged
       (canceled). A discharge releases you from all obligation to repay the loan.
       Some of the reasons for cancellation are:
       - Borrowers total and permanent disability, or death.
       - Full-time teacher for five consecutive years in a designated elementary or
         secondary school serving students from low income families.
      - Closed school before student could complete program, or false loan
        certification. For loans received on or after 1/1/1986
      - School does not make required return of loan funds to the lender
      - Full time special education teacher or qualified professional provider of early
        intervention services for the disabled.
      - Full time teacher in field designated as a teacher shortage area.
      - Full time nurse, medical technician, law enforcement or corrections officer.
      - ViSTA or Peace Corps volunteer
      - Bankruptcy, in RARE cases (decision would be determined by the court).

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                       Student Loans
What happens if you default on you loan?

The consequences of default are severe. You may lose tax refunds, have your wages
garnished or get sued. If you are sued and lose, you will have a judgment filed against
you, and creditors may have liens placed on your property (homes, autos, boats etc.). It is
now possible to have your Social Security income attached, as well.

Like most financial lending arrangements and contracts that are in effect today, the payment
history of student loans are reported to credit bureaus. If you are late in payment or in de-
fault on your student loan, it will most likely appear on your credit report.
Consider the following:
•  Delinquencies (less than (180 days late) stay on a credit report for 7 years.
•  Defaulted loans (no payment for over 180 days) appear and stay on a credit report as
    “Default” until resolved or paid. Once paid, the payment history of the loan will stay
   on a credit report for 7 years.
•  Judgments stay on a credit report until the judgment is satisfied. Judgments are
   renewable every 10 years.
•  Liens on property appear on your credit report.

All of the above have credit implications in terms of jobs, places to live and lines of credit
you might need, since employers, landlords, lenders, insurance companies and others look
at your credit report.


Organization is the key to success:

•   Keep records of all communications (letters, telephone conversations, etc.) you have
    with anyone while dealing with your student loans. Having detailed records will help
    keep you organized in terms of what you may need to do next, and provide you with
    documentation if any issue regarding you loan is questioned.
•   Keep all letters and materials you receive in the mail in a safe place, note date received.
•   Keep a telephone log of all phone conversations; include date, time, full name of person
    you spoke with, what was said, and any action that is agreed upon during the conversa-
    tion. Be sure to know what date action is to take place.
•   Keep your records for several years AFTER you have resolved and/or paid off your
    loan.




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