A student loan consolidation makes repayment seem more manageable because you only have one loan and one payment. You also have other ways for consolidating student loans such as a direct consolidation loan that offers many repayment options depending on your finances.
You can consolidate your student loan directly with the US Department of Education through a direct consolidation loan. They offer a number of payment options for you to choose.
If you need the flexibility to change your payment plan due to changes in your financial situation, the direct consolidation loan is what you need. It is designed for just his purpose.
Another repayment plan is called the standard repayment plan. With this plan you will settle on a fixed monthly amount until you have paid the balance in full. Your monthly payments can start out as low as $50.00 per month for 30 years depending on the amount you owe.
The extended repayment plan goes up to 25 years but to be eligible you have to have a loan amount that is more than $30,000. You can have a fixed monthly payment of $50 until you have paid off the whole loan or pay the interest first and settle the remaining amount later. For the latter option, your payment will start out very low and will increase every two years.
The income contingent repayment option determines your monthly payment based on your annual income, balance owed and the size of your family. The loan term may be extended for up to 25 years.
The direct consolidation loan does not have specific requirements for you to qualify, and there is no fee. You only have one lender to deal with which is the U.S. Education Department.
You now have all the information you need to know about the direct consolidation loan payment options. This should help you make a more informed decision about the program and let you compare with other consolidation loan programs that are available.
By: Ryan Wilkins
Posts Tagged ‘Department Of Education’
Student Loan Consolidation Info – What You Should Know About Stafford Loans?
January 27th, 2010
Stafford loans are the most common types of loan available for students perusing a higher education. Stafford Loans have been providing loans for students tuition and other college and school related financial requirements for many decades. There are many ways to receive a Stafford loan as many variants of the loans are available which can be processed depending on the cost and situation of the student.
Stafford loans are offered through the United States Department of Education either form the Federal Family Education Loan or in the form of William D Ford Federal Direct Loan. In both the circumstances, Stafford Loans are provided either to the student or parents who have requirements to pay for their children schooling fees.
Normally, most colleges and universities through out the United States do not participate in any one program for student loans. Some of them utilize the FFEL program whereas many go through the Direct Loan program. In the case of the Direct Loan program, it is the Federal Government that provides the loan amount but in the case of FFEL the amount of money for the loans come from credit institutions, banks or any other third party that participates in the program. The procedure of applying for the loan is same in both the cases but the repayment period and nature can be highly varied in both the options.
Also there are now two types of Stafford Loan, the first one being a subsidized Stafford Loan. In this type of loan the student actively pursues the college or university and it is the Government which pays for the interest on behalf of the student. The government pays for the interest during the student’s college period and for an estimated grace period after the completion of the course or till the time when the student is unemployed or has no other method of repayment. These types of loan are need-based loans and students who don’t qualify for the need based financial aid do not receive these types of loans.
An unsubsidized Loan is the second type of Stafford Loan which is not a need based loan. In this type of loan the government does not pays any interest at any time and it is the sole responsibility of the student to pay the interest and the principal amount, though the student can defer the interest rate for a further agreed time period. However students need to understand how interest will be added and applied to the principal of the loan.
Stafford Loans are popular amongst students due to their flexible nature of application and any type of student can apply for the loan and can be able to receive any version of the loan based on their eligibility. Stafford Loans are known for their easy repayment system and flexible nature which is highly suited for students and parents funding for college and or university education.
By: Ian Wilkie
Private Student Loans Consolidation
January 17th, 2010
When applying for student loan consolidation, or even looking into it, you need to first look at what kind of student loan you have. Student loans are split into two types; federal loans and private loans. Below is information on each one so you can categorize your own loan, and also find get some more information on your loan, and the other types of student loan consolidation out there.
Private Loans
Private loans, otherwise known as alternative loans are loans that have been orchestrated privately, instead of by a federal lender or corporation. These can sometimes be a good option and can have certain benefits, especially if you take out a loan with a well known family business, or someone trustworthy who may be able to give you a little slack when you need it, but as good as this may sound, private loans are lacking in certain areas, as well. One of the biggest cons being that they don’t offer the benefits and assurance of quality that are offered by federal loans, which are more closely inspected by the government.
Additionally, private loans are more susceptible to scamming, because they are not supported by the government as much as federal loans are. However, certain government agencies do have lists of untrustworthy or shady private lenders, to help protect customers. Some of these agencies include The U.S. Department of Education and the Federal Trade Commission. Make sure you take a look at these agencies websites and information before making a move towards a private loan.
Federal Loans
Federal loans are generally the best avenue to venture towards when taking out a student (or any type of) loan. They are both regulated and supported by the government, and are carried out by government agencies. This means that the agencies have been well inspected and are up to regulation. This gives customers a greater assurance of good service and safety in where they put their money. Two examples of federal loans are Federal Family Education Loans and Direct Loans.
Once you have decided which of the above categories you fit into, make sure to look into further details with your lender. If you have a private loan and haven’t already, make sure you ensure that they’re trustworthy and government inspected, if possible. If you have either loan, make sure to check details and ask about student loan consolidation. Good luck consolidating!
By: Darrell Wiggett