There are a lot of different types of student loans out there, so sorting through all of them can be tough, especially when there can be many names for the same thing. You might be surprised to find that Title IV loans and federal loans are one in the same! However, the term Title IV is applied to more than simply loans. Keep reading to learn more.
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Perkins loans are great options for those students who are eligible. They have low interest rates and can be used for both undergraduate and graduate studies. But before you accept the loan, make sure you get all of the facts.
So, here’s what you can expect from a Perkins Loan. These loans are federally funded and only available to the students in highest need. They differ from other federal government loans in that they are dispersed through different lenders. While other federal loans are dispersed through the government, Perkins Loans are the only ones to come directly from your college.
For each year of school, students are allowed to take out up to $4,000 ($8,000 for graduate students). Typically, the loans are dispersed to you in two installments, one for each semester. The funds either get sent directly to you via check or applied directly to your school account.
Learn more about Perkins loans borrowing limits, interest rates and repayment at the StudentLoanNetwork.com.
Unfortunately, not all students will qualify for Perkins loans. So for these students, here are some other options.
One such option is searching for scholarships. While the the payout for scholarships is usually minimal when compared to the time spent applying, any little bit can help. Plus, unlike loans, scholarships never need to be repaid. To make it easy to keep track of scholarships and their deadlines, try keeping a spreadsheet so that you know which you’ve applied to and when to apply next. StudentScholarshipSearch.com is a great resource and makes it easy to help you find relevant scholarships; plus, there are new ones posted daily, because let’s face it, you’re busy enough being students.
If scholarships don’t pan out, then consider getting private student loans. While we typically tell students to exhaust all of their federal loan options first, getting a private loan can be a great option to cover the remainder of your expenses. Just like any other big financial decisions, it’s best to shop around before making your final choice, so make sure to compare your loan options as this can be incredibly beneficial.
So if your Perkins loans did not cover enough of your school expenses, then no worries, these other options can really help bridge the gap in your financial aid.
For most families, the act of opening the financial aid offer letter is a harrowing one. In just a few short sentences they will see how much a college or university is willing to offer in the way of student loans and scholarships. But what happens when that figure is too low?
Believe it or not, a student aid package that offered less than expected does not necessarily mean the end of the road. In some cases, a borrower can appeal to the school for more money. So how can this be done?
For starters, strike the word “negotiate” from your vocabulary. If you call a financial aid office and tell them you want to negotiate your student loan package, it will be a very short phone call. You are not negotiating. You are “appealing.” There is a difference. The first step is to call the financial aid office and inquire about the process of submitting an appeal. Most likely, you will be asked to write a letter explaining, in detail, why you feel the aid package should be reconsidered.
Your appeal letter will explain, in brief, the grounds on which you are appealing the financial aid offer. You should decide early on whether this an appeal for need or for merit, or for both. If it is an appeal for need, you must demonstrate to the school that your federal aid package simply isn’t enough for you to afford attending the school. More than likely, a successful appeal based on need will cover a recent change in your financial situation, such as a series of expensive medical bills or a parent losing his or her job. You will need evidence to back up your claim, including copies of bills and pay stubs.
You may also appeal on the grounds of merit. An exceptional student may be eligible for various scholarships or grants. Look into the criteria for these awards. The best evidence to appeal on these grounds is a stronger scholarship offer from a similar school.
One of the most common issues students deal with revolves around the FAFSA filing status. Many students feel they should be considered independent, yet the FAFSA still requires them to file as dependent. Under special circumstances, students have the ability to appeal their dependency status. For those students who believe their circumstances qualify them for financial independence (for FAFSA purposes), I’m going to walk you through how to do this, including what documents you may need. If you don’t know your current status, read our post on Dependent VS. Independent Status.
First thing’s first, if your sole reason for filing an appeal is that you support yourself or that your parents refuse to support your education, then you will not qualify for an appeal. However, other circumstances are considered. Some common reasons for appealing dependency include:
Keep in mind, these are not the only reasons that are accepted as schools differ in their requirements. If you’re not sure if your particular situation qualifies, you should contact a financial aid officer from your school.
Each school has specific guidelines for the appeals process, and in some cases, there are school-specific forms you will need to fill out. Most of the time you can find the qualifications and forms on the school’s website. However, the one thing that most schools ask for is a letter from the student explaining their circumstances. In this letter, make sure to be specific! After all, you’re arguing your case, so the more information you provide, the better. Included in this letter should be 1) why your parents aren’t helping 2) information regarding your income and what your money is allotted for and 3) your educational goals, explaining why more money is necessary to achieve them through your institution. Each situation is different, so tailor the letter to you and what your needs are. Along with this letter, it is important to provide as much documentation as possible to back up your claim. Acceptable documentation includes (but is not limited to):
Once all of your required documents have been submitted, all you can do is wait. Depending on your school, your appeal will be reviewed by a financial aid officer or panel of officers who will work with the Department of Education to change your status (hopefully). It is possible that more documentation may be required, and if this is the case, you will be contacted. If you do need to provide more, don’t panic! Simply provide the requested documents and wait it out. Note: If you are approved for a certain year, this does not mean that you are approved for upcoming years as well. For future academic years, you will need to appeal again!
Navigating the FAFSA to get adequate financial aid can be a nightmare for some students, so appealing dependency status may be the difference between going to school or not. If you have any specific questions about your school’s process, they should be directed to your financial aid office. Good luck!
Applying for and receiving financial aid can be a long and confusing process, but don’t fret, we’re here to help! We’ve compiled information on all of the steps necessary for receiving financial aid to help answer your most common questions. The financial aid roadmap outlines all of the steps you should take, from how to fill out your FAFSA to tips on comparing financial aid packages.
So, what are the steps?
Now that you have the entire process at your fingertips, make sure to start early! It’s important to file your FAFSA as soon as possible so that you can receive maximum aid and be on your way to that college degree.
Applying for federal loans is a common task for most college students, but did you know that when you file your FAFSA you’re automatically applying for federal grants as well? Unlike loans, federal grants do not need to be paid back and are both tax and interest-free. By submitting your FAFSA you are considered for a number of grants including:
While not all of the grants are need based, you still must qualify in order to receive aid. Eligible students will receive notice of all aid including grants in their Student Aid Report (SAR).
For more information on these grants, check out our page on Federal College Grants and Scholarships at FAFSAOnline.com.
As I’m sure many of our readers out there know, the interest rate for subsidized undergraduate Stafford Loans has recently lowered for the 2010-2011 year. As of July 1, 2010, the interest rate dropped from 5.6% to 4.5% which was a major step forward for federal loans.
Well, lucky for all the students out there with Stafford loans, because it’s scheduled to happen again. The Subsidized Federal Stafford Loan interest rate for the 2011-2012 academic year is planned to drop to 3.4%, hitting an all-time low!
For more information on student loan interest rates, visit Staffordloan.com where you can also read about loan repayment options.
It’s January, 2011. So, what does that mean? Well, for starters, Happy New Year! I’m sure many of you have been thinking about your plans for the upcoming year, maybe even jotting down some of those resolutions. There are two in particular that we might have in common: go back to school or finish up school, and save money.
Well, with that in mind, the team at FAFSAOnline.com has been working diligently to bring you the most current and most beneficial information about the new FAFSA form for the 2011-2012 school year. If you’re not familiar with the FAFSA already, it is the Financial Application for Federal Student Aid and the first step in your financial aid process. Federal grants and loans are the best source for financial aid, and private student loans can fill in the gaps.
We have recently updated the FAFSA deadlines pages for both federal deadlines and state deadlines.
The new FAFSA form was released this past week. FAFSAOnline provides you with a free guide and eBook for help with the FAFSA form. There are also a number of special financial aid tips we share, that can help you maximize your aid and avoid common mistakes on your FAFSA form. You can also go to FAFSAOnline to get your Federal School Code, which you will need to identify the school(s) you are attending or applying to.
Stay tuned for a brand new 2011 eBook for the FAFSA form.
Source: FAFSA blog
As we approach the end of calendar year 2010, it’s a good idea to turn our eyes to the future and start thinking about our 2008 financial aid efforts. Here are 5 strategies to help you make the most of the waning days of 2010 with payoffs in the year to come.
1. See an expert. Most community banks and credit unions offer access to a certified financial planner for little or no charge, making them a great, hidden resource for figuring out your finances. Take the opportunity and an hour or two on a weeknight or weekend to see one and review your personal finances. Get a sense for where you are and how your finances are currently set up.
2. Start writing scholarship essays. Scholarship season really starts in earnest in January of each year, and the sooner you can get your applications in to a scholarship foundation, the sooner you can move onto the next application. Do your research for which scholarships would be appropriate to apply to, and download their applications. The most time consuming part of the scholarship search is the essay, so start writing now!
3. Do your budget. January is often thought of as the time to embark on resolutions, but now is the time to plan for those resolutions so you can hit the ground running after the champagne’s gone.
4. Set goals. Set measurable, achievable goals for yourself in 2011, like a scholarship application a weekend. Be sure to have a calendar set up so you don’t miss any deadlines.
5. Get ready to file your FAFSA. The FAFSA process kicks off on January 1, but having your IRS 1040 mostly done will speed up the process, as will doing the FAFSA worksheets. Run through our FAFSA tutorials here on FAFSAonline.com and make notes of where you have questions – then contact your financial aid officer or attend a College Goal Sunday event to get those questions answered!
Did you know you are not required to complete your IRS federal tax return before filing your FAFSA? It is a common misnomer that it is required when it is simply encouraged. However, there will be a question on the FAFSA about which IRS Tax Form you will fill out in the future, if you haven’t already, and that is where the 1040 Form comes up.
Why you should fill out the 1040 while preparing your FAFSA form: (more…)
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