Loan Consolidation and Repayment Options by liaoguiguo


									Information for Students on Loan Consolidation and Repayment

Because there have been many changes in repayment terms and
consolidation of loans in the past 2 years, the School wanted to give you
some information about what might be available to help you in planning for
repayment of your loans.

Loan Consolidation:

The Direct Loan program under the federal government still does offer a
loan consolidation program. To qualify for a Direct Consolidation Loan,
borrowers must have at least one Direct Loan or Federal Family
Education Loan (FFEL) that is in grace, repayment, deferment or default
status. Loans that are in an in-school status cannot be included in a Direct
Consolidation Loan.

Borrowers who do not have Direct Loans may be eligible for a Direct
Consolidation Loan if they include at least,

      • One FFEL Loan in the consolidation and have been unable to
        obtain a Federal consolidation Loan with a FFEL lender


      • Have been unable to obtain a Federal Consolidation Loan with
        income – sensitive repayment terms acceptable to them or intend
        to apply for loan forgiveness under the Public Service Loan
        Forgiveness Program.

If you would like more information on the above, here is how to contact

      Apply on line:
      Telephone:     1-800-557-7392

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Loan Repayment Options:

Most banks/lenders offer some different repayment options for the
repayment of your student loans. Below are the 4 most frequently used loan
repayment options, but students should always check with their lenders to be
sure of what they offer as each lender is different.

   • Standard Repayment Plan option: With this plan, you pay the same
     amount every month on a fixed rate for your student loan for the life
     (normally 10 years) of the loan.

   • Extended Repayment Plan option: An extended repayment plan
     reduces your monthly loan payments by spreading them over a period
     of up to 25 years. Since payments are stretched over a longer term,
     total interest costs are higher when compared to the Standard
     Repayment plan. There is no penalty for early payment on this option.

   • Graduated Repayment Plan option: With a graduated repayment plan,
     you make interest only payments for the first two to four years, or pay
     a $50.00 a month, whichever is greater. After the initial period of
     lower payments, your payments will increase to include principal and
     interest for the rest of the term of the loan.

   • Income-Sensitive Repayment Plan option: Under an income-sensitive
     plan, you have the option to request a specific monthly payment
     amount. This payment must be at least equal to the monthly interest
     due on your loans or 1% of your gross monthly income, whichever is
     greater. This plan is designated for a 12 month period and must be
     renewed on an annual basis.

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