“Damn Sallie Mae”

Going to college is the goal for most high schoolers and for a lot of people who wish to further their education. Paying for college is what deters the majority from attending. Do I blame them? No! College is not cheap and if you don’t have scholarships it can run you into a lifetime of debt. Is it worth it? Maybe, maybe not. I would like to think so but in today’s economy a Bachelor’s degree is being treated like a high school diploma. Jobs after graduation are not guaranteed and most places want you to have a Master’s degree or higher. My question is how can we get Masters degrees when we are swimming in debt from undergrad?

It’s hard to pay for school coming from middle and lower class homes. We don’t readily have assistance and often times our parents can’t do much because their credit doesn’t allow them to or quite frankly, they don’t have the money. That makes us targets for loans, especially private ones. Every time I get mail there’s a letter from Sallie Mae offering me money and trying to persuade me to take the bait. It’s easy  to fall victim when you can’t afford tuition and you run out of options. I haven’t taken out a private loan yet but I’ve taken out subsidized loans through school, sometimes taking out more than I needed just to receive a refund check. When looking at ways to fund college it is very important to explore all options and if you find yourself considering a private or unsubsidized loan, or any loan at all, you have to be very mindful. Do your research on deferred payments, interest rates, and loan repayments. Talk to your financial aid counselors before accepting, the last thing you want to do is get caught up and find yourself in a very bad place after graduation. If you don’t need the loan, DO NOT take it out. If you don’t need the amount offered please consider reducing your loan to fit the amount you need, just because you get a refund check doesn’t mean you don’t have to pay that money back. There is no such thing as free money! Take advantage of the resources on the web, there are many scholarships out there, some you don’t even have to write essays for. A few sites that I love are fastweb, cappex, and scholarships.com.  If you plan to study abroad the Gilman Scholarship and  Boren are great to look into, applications for Spring 2016 have just opened. If you need more information on loans you can go here please educate yourself before agreeing to sign a loan agreement. Don’t let Sallie Mae ruin your life, treat her like that ex you can’t stand and tell her to swerve every time she hits you up.

Loans are the reason I hate school but love education. Good luck and best wishes on your journey to higher learning! Thanks for reading, Be Blessed & Stay Humble.

Here’s a quick overview of Direct Subsidized Loans:

  • Direct Subsidized Loans are available to undergraduate students with financial need.
  • Your school determines the amount you can borrow, and the amount may not exceed your financial need.
  • The U.S. Department of Education pays the interest on a Direct Subsidized Loan
    • while you’re in school at least half-time,
    • for the first six months after you leave school (referred to as a grace period*), and
    • during a period of deferment (a postponement of loan payments).

Here’s a quick overview of Direct Unsubsidized Loans:

  • Direct Unsubsidized Loans are available to undergraduate and graduate students; there is no requirement to demonstrate financial need.
  • Your school determines the amount you can borrow based on your cost of attendance and other financial aid you receive.
  • You are responsible for paying the interest on a Direct Unsubsidized Loan during all periods.
  • If you choose not to pay the interest while you are in school and during grace periods and deferment or forbearance periods, your interest will accrue (accumulate) and be capitalized (that is, your interest will be added to the principal amount of your loan).

Federal Student Loans

Private Student Loans

You will not have to start repaying your federal student loans until you graduate, leave school, or change your enrollment status to less than half-time. Many private student loans require payments while you are still in school.

 

The interest rate is fixed and is often lower than private loans—and much lower than some credit card interest rates. View the current interest rates on federal student loans. Private student loans can have variable interest rates, some greater than 18%. A variable rate may substantially increase the total amount you repay.
Undergraduate students with financial need will likely qualify for a subsidized loan where the government pays the interest while you are in school on at least a half-time basis. Private student loans are not subsidized. No one pays the interest on your loan but you.

 

You don’t need to get a credit check for most federal student loans (except for PLUS loans). Federal student loans can help you establish a good credit record. Private student loans may require an established credit record. The cost of a private student loan will depend on your credit score and other factors.
You won’t need a cosigner to get a federal student loan in most cases. You may need a cosigner.

 

Interest may be tax deductible. Interest may not be tax deductible.
Loans can be consolidated into a Direct Consolidation Loan.  Learn about your consolidation options.

 

Private student loans cannot be consolidated into a Direct Consolidation Loan. 
If you are having trouble repaying your loan, you may be able to temporarily postpone or lower your payments. Private student loans may not offer forbearance or defermentoptions.
There are several repayment plans, including an option to tie your monthly payment to your income. You should check with your lender to find out about your repayment options.
There is no prepayment penalty fee. You need to make sure there are no prepayment penalty fees.
You may be eligible to have some portion of your loans forgiven if you work in public service. Learn about our loan forgiveness programs. It is unlikely that your lender will offer a loan forgiveness program.
Free help is available at 1-800-4-FED-AID and on our websites. The Consumer Financial Protection Bureau’s private student loan ombudsman may be able to assist you if you have concerns about your private student loan.

Information obtained from Federal Student Aid 

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