Student Loans

Question 1

Types of Financial Aid …

Answer 1

Grants, scholarships, work-study, loans

Question 2

____________
* Automatically accepted
* Split equally between Fall and Spring semesters
* Does NOT need to be paid back

Answer 2

Gift Aid

Question 3

_________________
* Community Foundations
* Town Halls
* Local Clubs/Lodges
* Places of Worship
* High School Counselor
* Alumni Associations
* Local Business/Libraries
* Your Parents Occupation/Job

Answer 3

Where to find more scholarships

Question 4

FAFSA - …

Answer 4

Free Application for Federal Student Aid

Question 5

NSLDS - …

Answer 5

National Student Loan Data System

Question 6

OFA - …

Answer 6

Office of Financial Aid

Question 7

COA - …

Answer 7

Cost of Attendance

Question 8

EFC - …

Answer 8

Expected Family Contribution (results of
the FAFSA)

Question 9

SAI - …

Answer 9

Student Aid Index

Question 10

Types of loans …

Answer 10

Federal (backed by the government), private

Question 11

_____________
* Issued by lenders such as bank or credit union
* Typically, variable interest rates and no interest ceiling
* Credit check is required
* Not based on need-don’t have to file FAFSA
* No borrowing limits
* (Loan max, up to cost of education minus other aid)
* No benefits for death or disability
* (Benefits not equal to federal student loans)
* (Designed to fill in the gap left by other loans)

Answer 11

Loan Types-Private

Question 12

When Do My Payments Begin?
_____________
* 6 months after graduation
* Less than ½ time

Answer 12

Direct Subsidized & Unsubsidized

Question 13

When Do My Payments Begin?
_____________
* Varies based on lender preferences

Answer 13

Private

Question 14

When Do My Payments Begin?
_____________
* 2 months after full receipt of the loan
* 6 months after graduation

Answer 14

PLUS

Question 15

Grace Period & Deferment
* Grace period of …

Answer 15

6 or 9 months after graduation

Question 16

Grace Period & Deferment
* In-school deferment (__________)
* (Interest continues to accrue on unsubsidized loans and PLUS loans)
* (If you do not pay the interest, it may be capitalized and added to the principal at the end of your grace period)

Answer 16

Enrolled at least half-time

Question 17

Repayment Options
_________ - 10 years

Answer 17

Standard

Question 18

Repayment Options
__________ - Low beginning payment increases every 2 years. 10 years max repayment.

Answer 18

Graduated Repayment

Question 19

Repayment Options
__________ - Repayment 25 year

Answer 19

Extended

Question 20

Repayment Options
___________ - Repayment based on a 12-year repayment, or 20% of your discretionary Income, divided by 12 years

Answer 20

Income Contingent (ICR)

Question 21

Repayment Options
___________ - Generally 10 percent of your discretionary income, but never more than the 10-year Standard Repayment Plan amount

Answer 21

Pay As You Earn (PAYE)

Question 22

Repayment Options
___________
* Partial financial hardship (PFH)-determined annually based on HHS & and
income
* Payment is 10-15% of the net income over 150% of poverty line and could
be as low as $0
* Max payment is the standard amount of time to go into repayment
* Balance forgiven after 25 years but taxed

Answer 22

Income Based (IBR)

Question 23

___________
* Bundles your federal loans together
with one fixed rate
* In some circumstances, this could
reduce your payments
* Your repayment period may be extended up to
30 years depending on the amount of your
consolidated loan

Answer 23

What Is Consolidation?

Question 24

___________
* Loss of any loan benefits such as interest rate discounts
or rebates
* Will consolidation increase my total cost?
* Once you consolidate it cannot be revoked for any reason

Answer 24

Things to Consider Before Consolidating

Question 25

___________ * Simplifies record-keeping * Variable-rate education loans are converted to fixed rate loans * Can significantly reduce your monthly payments because consolidation allows you to stretch your repayment period from the standard 10 years up to 30 years

Answer 25

Consolidation Advantages

Question 26

__________ * Extending repayment period increased total interest payments * If you are in a situation where the military (or other entity) will repay all/some of your loans, do not consolidate

Answer 26

Consolidation Disadvantages

Question 27

How Is Student Loan Interest Calculated? __________ *Your interest rate is divided by the number of days in the year, and you are charged each day based on the outstanding balance.

Answer 27

Compounded Daily

Question 28

How Is Student Loan Interest Calculated? __________ * Addition of unpaid interest to the principal (increases the amount due) * Repayment strategy - pay interest on unsubsidized loans PRIOR to capitalization

Answer 28

Capitalization

Question 29

How To Save __________ * Borrow only what is needed * Live like a student now to be able to enjoy life more fully when you’re earning

Answer 29

Borrow Less

Question 30

How To Save __________ * Make payment now * Make extra payments to reduce cost * Contact servicer for details

Answer 30

Voluntary loan payments

Question 31

Help With Payments __________ * Temporarily postponing payments

Answer 31

Deferment

Question 32

__________ * In-school (must be at least half time) * Unemployed * Economic hardship * Military service

Answer 32

Types of deferment

Question 33

Help With Payments __________ * Postpones repayment if financial hardship * Interest still accumulates

Answer 33

Forbearance

Question 34

Education Tax Savings __________ * Deductible up to $2,500 in interest

Answer 34

Student loan interest

Question 35

Education Tax Savings __________ * $2,500 per student

Answer 35

American Opportunity Credit

Question 36

Education Tax Savings __________ * 20 percent of the first $10,000 of qualified education expenses or a maximum of $2,000 per return

Answer 36

Lifelong learning credit