Student Loan News, Updates and Blog Posts

Friday Rant!

Did you hear the good news about the 2009-2010 academic year? In addition to the increase in Pell Grant money (which is great for students), Federal Stafford loan funds have been increased by $2,000! Terrific, let’s poor more student loan debt on the children of tomorrow.

Do you know what happens when the federal reserve puts more money into circulation? Inflation spikes which devalues the dollar; although that also has a positive subsequent effect on our nations trade deficit. Still, the point I’m making is that more isn’t always better. Giving students more money doesn’t get to the root of the problem, which is that tuition is so overpriced it’s ridiculous!

I really feel for the students of today who are getting out of school with mini-mortgage payments and no job prospects. The trail of tears is long. You may want to inquire about free debt consultation if you are struggling with your monthly bills like so many Americans these days. For those students who are still in school there is some hope in the form of scholarships.

At ScholarshipPoints.com, our sister site, we know how tough it is on today’s students, which is why we are committed to helping as many as we can with $100,000 in free scholarship money. Take a look at all the year-to-date winners.

Taking that one extra step may save you thousands of dollars. So I guess more money is a good thing after all, provided it’s in the form of a scholarship.

The Expected Family Contribution (EFC) number is not the amount of money that your family must provide. Rather, you should think of the EFC as an index that colleges use to determine how much financial aid you would receive if you were to attend their school. That means the EFC figure may vary from school to school, which is normal.

Your EFC number is located in the upper right hand corner of your student aid report (SAR). Your SAR report is generated by the Department of Education after you file your FAFSA.

I’m sure you’ve heard that a Master’s Degree is the gateway to a greener tomorrow, and it’s true. Statistics support the fact that more education equals a higher base salary. But do you really know why MBA holders get paid the big bucks?

I used to be one of those people who would walk around saying it’s just a piece of paper, and that I can do whatever that guy can do. Actually, I still kinda believe that. Partly because while a student is sitting in a classroom learning the subject matter, real world solutions are changing by the minute. So while I agree the lesson is important the solution is not always viable.

Sometimes it’s more about the people than the piece of paper itself that makes the difference in landing that high paying job. Many employers essentially let the colleges do the employment screening for them. They figure to get into grad school you needed to take an entrance exam and have solid letters of recommendation. Clearly you are motivated, they surmise, so they hand you that job based on your previous academic commitment. The fact is in most instances you need to learn the business you are joining from scratch. Everything doesn’t fit neatly into a classroom box.

So while you learn powerful tools that will help navigate your success in grad school, it is not always those tools that help you land your next job. However, that piece of paper serves as your boarding pass.

If you need a graduate Stafford, Plus, or Private school loan (click here).

Did you realize your Stafford loan may hold one of several statuses? The most common status these days is deferment (after you get out of school). Many can not afford to pay their student loans at this time so they are deferring their loans for a period of time. Stafford loans come equipped with up to three years worth of deferment time.

Knowing your status is very important. If you change schools, for example, you want to make sure you maintain your “in school” deferment status otherwise it may shift to “grace” meaning your loan will come due within six months time.

Just be sure to monitor your loan status. It could save you a lot of headaches later.

Possible Statuses

In sports it seems the focus on talent has been getting younger and younger. In my lifetime I’ve witnessed the focus on student athletes shift from college to high school and now to (gulp) middle school. I’ve actually been joking with friends recently that my 18-month son has some powerful thighs and would make a great fullback with his low 28-inch center of gravity. Maybe he could even get a free ride to a choice nursery school! But all joking aside, middle school is an important time in a students life, athletics aside.

Middle school ushers in a new set of challenges for parents as kids become more interested in social life. It’s these impressionable years that can set the stage for future success or failure in the world of academia. Making your presence felt is key.

Parent/teacher conferences are good, but are not nearly enough. Volunteering for field trips and school dances are a way to make yourself known within the school community. When teachers know the parent they tend to form a better relationship with the student. It’s also important for the teacher to know they have your support, and that you all stand together on a united front as to what is best for your child.

Serve as your childs scout, even if they don’t have a killer jump shot. Assess their strengths and weaknesses and help them be the best they can be.

If you receive a degree in the field of early childhood education, become a childcare provider in a facility that serves a low-income community, and meet other eligibilty requirements, you may be eligigble to have up to 100 percent of your combined Direct Loan or FFEL debt cancelled. However, this type of loan forgiveness depends upon the availabilty of federal funds. If no funds are available, you will not be able to receive this type of forgiveness.

While Stafford loans remain your best loan option for higher education it is important to be mindful of the amount you are borrowing – it can get out of hand quickly.

As a rule of thumb repayment of student loans should be only a small percentage of your salary after you graduate.  If you expect to pay more than 15 percent of your annual salary for student loans, you might have difficulty making your monthly payments.

Ask your school’s FAO for starting salaries of recent grad’s in your field of study to get an idea of how much you are likely to earn after graduation.

Estimates of salaries for different careers are available in the Occupational Outlook Handbook at www.bls.gov/oco.

When you hear the term “federal student aid” that can be classified into one of three categories.

Grants: Free money that doesn’t have to be repaid, except in some cases when you withdraw from school.

Work-study: You earn money to pay for your education.

Loans: You borrow money for school, which you must repay with interest.

“Republicans haven’t given up on the guaranteed-loan program, Rep. John Kline of Minnesota said today. They have just been preoccupied with health care and other pressing issues,” The Chronicle of Higher Education reports. “‘I remain hopeful we can keep some private capital in this and keep the private sector involved,’ the new top Republican on the House education committee told three higher-education reporters in an interview. ‘We’re not rolling over.’”

“The 35 guarantee agencies that work with lenders, borrowers, and the U.S. Education Department to administer bank-based student loans have evolved into inefficient middlemen that waste taxpayer money, the New America Foundation said today in a policy report released just as Congress prepares to debate a student-lending plan that could eliminate the need for guarantee agencies,” The Chronicle of Higher Education reports. “The agencies, intended to insure banks against default losses and thereby encourage them to offer better rates on student loans, have become largely administrative bodies, according to the nonprofit group’s report.”