Posted by Dawn, Apple FCU

Due to the high cost of college tuition many families are unable to pay for college with savings alone. Traditionally, the availability of student loans has provided an important avenue in allowing students to be able to go to college. 
 
Many lenders that are still offering loans are charging higher interest rates and/or fees. Even though paying for school may seem like a daunting task there are several steps you can take to find financing:
 
• Talk to your school’s financial aid office. Employees at financial aid offices are trained to help people find financing for school and have dealt with many others in the same situation as you. Ask them what lenders still offer student loans and what your other options for funding are.
 
• Look for scholarships and grants. It is a good idea to look for scholarships and grants regardless of how easy it is for you to find student loans. Why borrow when you do not need to? High school guidance counselors and college financial aid offices usually have information on available scholarships and grants. Information is also available at www.finaid.org.
 
Look into Apple FCU’s Student Choice Loan options.  Apple provides student loan options for those looking to fill the “gap” after scholarships and grants.  For more information, visit http://applefcu.studentchoice.org/.

Information courtesy of Balance®

 
Posted by Theresa, Apple FCU
 
 
 
 
Reading all your student loan payment options beginning to feel like deciphering the DaVinci code? Well we’re here to help — Minus Tom Hanks’ acting. (You can thank me later.)
 
Figuring out what your student loan payment options are shouldn’t be as hard as paying them off. During a time where the cost of college may outpace entry level job salaries, it’s more important than ever to know what your options for repayment are. Below are a few definitions that may help you better understand your options.

 
Standard Repayment Plan — A monthly payment that is usually stretched out over 10 years or less.
 
Graduated Repayment Plan — Begins with a lower monthly payment than the standard plan (payment not to be less than the interest) and increases generally every two years.
 
Extended Repayment Plan — Allows for the period of repayment to extend up to 25 years.
 
Income-Related Repayment Plans — Various payment plans established by your income exist with only minute differences on the minimum amount required and the origin of the loan.
 

Income-Contingent Repayment Plan (Direct loans only, excluding parent PLUS loans) — Payment varies based upon your income and family size. As your income increases, so does your required payment. This payment can be less than the interest owed.
 
Income-Sensitive Repayment Plan (FFEL loans only) — Much like the prior, payment varies based upon your income, however, the payment must cover at least as much as the interest.
 
Income-Based Repayment Plan (parent PLUS loans) — Payment is based upon your income and family size, however, in order to be eligible for this plan you must meet a certain debt-to-income ratio. This payment is usually lower than the other two income-related payment options.

 
Deferment and Forbearance — Very similar in nature, these two terms are often mixed up. Both are offered for federal student loans, but are not required by private lenders. The two provide relief in the form of temporary suspension of payment in the event of financial hardship.
 

Deferment — A temporary suspension of payments where if the loan is subsidized, the interest is suspended. If the loan is not subsidized, the interest will continue to accrue.
 
Forbearance — A temporary suspension of payments where interest continues to accrue regardless of whether your loan is subsidized.

 
Default — When a loan payment is more than 270 days past due. This occurs if deferment or forbearance is not arranged. (Hopefully you never have to hear this word).
 
Consolidation — Allows for the merging of two or more loans into one single loan payment with one lender as opposed to multiple lenders. This may result in paying less interest over time as consolidation loans may carry a lower interest rate.
 
Cancelation/forgiveness — More difficult to attain than other payment relief options, these allow for complete cancellation of the loan and occur commonly in death or permanent disability of the borrower.
Read more about student loans, repayment plans, and alternative payment options from BalanceTrack®.
 
 
Resource: BalanceTrack®, a financial education tool provided to credit unions worldwide. http://www.balancetrack.org/repayingstudentloans/ch4.html