Funding Your Education – Understanding Student Loans


As an undergraduate you may have
been lucky enough to have a family member who helped you with the financial
aid process. Many graduate students are tackling
financial aid on their own for the first time. I hope that the content in this
video and on our website will help you
navigate that process. Federal Direct Loans are available to most U.S. citizens and permanent residents. The money comes from the federal
government and you apply through the school. The reason many students like this
option is because it offers the most
comprehensive, flexible repayment plan, repaying loans over the course of
between 10 and 25 years. And some of the options even allow
you to repay based on your income. Current interest rates and fees can be found at
Studentloans.gov. There are many reasons you might
choose to take out a private loan. First, not every student is eligible for a federal direct loan. International citizens, for example, are not eligible to
take out that type of loan. Second, might be the interest rates and fees. Interest rates for private loans can
be competitive with federal direct loans, particularly if you have an
exceptional credit score or your co-signer has a strong credit score. Also, origination fees are common to federal loans but not common to private loans. That would reduce your overall cost. If someone is hoping to help you with the cost of your education they can take out a loan on your
behalf. Often that would be a parent or a spouse who would be able to
apply for a private student loan towards the cost of your education. Finally, if you have an aggressive repayment plan after you graduate and don’t anticipate needing the
flexibility of federal repayment, then private loan might be a good fit for you. Once you’ve decided whether you plan
to take a federal or private loan I recommend that you run a repayment calculator. You can do this either through the federal direct loan site, Studentloans.gov, or through the Elm platform that you’re looking at
private loans. Or, there are lots of repayment
calculators available online. Once you do that, I will ask you through the aid
confirmation forms sent in the spring what type of loan you plan to take and how much you’d like to borrow. Since I know your expenses may be a little different than what
you plan you can adjust loan amounts later in the year if you need to, but the maximum you can request is the total estimated cost on the website less any other resources such as scholarships, grants and other loans. Deciding between loans and financial information in general is very personal. So while I hope you found this
helpful, don’t hesitate to reach out to me to discuss your personal situation. The best way to get in touch with me is by email. I’d be happy to set up a time to
speak one on one.

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