Transcript Financial Aid Information for Higher Education

2014
Financial Aid Exit Interview
College of Dentistry
College of Dentistry Class of 2014
University of Illinois at Chicago
Your Loan Summary
 https://studentloans.gov/myDirectLoan/index.action
 Your Loan Summary is based on information from the National
Student Loan Database System (NSLDS).
 NSLDS does not include private or institutional loan
information.
 You should review your loan information for Stafford, PLUS,
and Perkins Loans at www.nslds.ed.gov.
 You should review HPSL Loans at www.acs-education.com.
Your Rights and Responsibilities
 You have the right to notification in writing if your loan is sold
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or transferred to another lender.
You have the right to prepay all or any portion of your loans
without penalty.
You have the right to a minimum of 10 years to repay your
loans unless you consolidated and qualify for an extended
repayment schedule.
You are responsible for your loan and accrued interest.
You are responsible for notifying your lender if you change
your name, address, Social Security number, etc.
Default
 Failure to repay a loan according to the terms of the
promissory note is called default.
 If you cannot make your payment, it is your
responsibility to contact your lender(s) and request a
deferment or forbearance.
Default Repercussions
 If debtor enters default, the entire balance of the loan
may become due immediately.
 Loan defaults will be reported to credit bureau's,
which will result in a negative credit report.
 Wages may be garnished.
 Debtors account may be forwarded to collection
agency.
 Debtor may lose their professional license.
Terms of Loans
 Perkins Loan
*Grace Period: 9 months
*Interest Rate: 5%
*Repayment Length: 10 years
*Eligible for Consolidation: Yes
*Eligible for Deferment/Forbearance: Yes
*No interest accrues during deferment
Stafford Loans
 Stafford Subsidized Loans
*Grace Period: 6 months
*Interest Rate: 6.8%
*Repayment Length: 10-25 years (repayment depends
on plan you choose)
*Eligible for Consolidation: Yes
*Eligible for Deferment/Forbearance: Yes
*No interest accrues during deferment.
Stafford Loans
 Stafford Unsubsidized Loan
*Grace Period: 6 months
*Interest Rate: 5.41-6.8%
*Repayment Length: 10-25 years (repayment depends
on plan you choose)
*Eligible for Consolidation: Yes
*Eligible for Deferment/Forbearance: Yes
*Interest accrues during deferment.
Graduate PLUS Loan
 Grad PLUS Loan
*Repayment begins 6 months after graduation
*Interest Rate: 6.41-7.9%
*Repayment Length: 10-25 years (repayment depends
on plan you choose)
*Eligible for Consolidation: Yes
*Eligible for Deferment/Forbearance: Yes
*Interest accrues during deferment.
Health Professional Student Loan
(HPSL)
 HPSL Loan
*Grace Period: 12 months
*Interest Rate: 5%
*Repayment Length: 10-20 years (repayment depends
on plan you choose)
*Eligible for Consolidation: Yes
*Eligible for Deferment: Yes
*Forbearance: Negotiable
*No interest accrues during deferment.
Private Loans
 Private Loans
*Grace Period: Varies by year and lender
*Interest Rate: Varies by lender
*Repayment Length: Varies by year and lender
*Eligible for Consolidation: No
*Eligible for Deferment: Yes
*Forbearance: Yes
*Interest accrues during deferment.
Typical Grace Periods
 Stafford Loan: 6 months (subsidized and unsubsidized)
 Perkins Loan: 9 months
 Graduate PLUS Loan: 6 months
 HPSL Loan: 12 months
If you are planning on using a deferment, you must wait until
after your grace period is exhausted.
Deferment
 A deferment is period of time when a borrower is exempt from
having to immediately begin repaying a loan.
 Deferments are regulated by the lender.
 The criteria for deferment is set by the lender. Typical deferment
conditions are continuing education, economic hardship, inability
to find full-time employment, and active military duty. If you
enroll in residency program more than half-time, you will
continue to qualify for an in-school deferment.
 Please note that you must continue to repay your loans until you
have been notified that your deferment request has been
granted.
Forbearance
 Forbearance occurs when your lender agrees to
either temporarily reduce or postpone your student
loan payments.
 If you are granted a forbearance, interest will
continue to accrue regardless of the type of loan you
have.
 Always see if you are eligible for a deferment first,
due to the way that the subsidized loan interest is
treated.
Repayment Options
 Standard Plan is a fixed annual repayment paid over a fixed
period not to exceed 10 years.
 A Graduated Plan is paid over a fixed period of 10 years. The
payments start relatively low and then increase, generally
every two years.
 Extended Plan for borrowers with more than $30000 can repay
their loan with a fixed or graduated amount for a period that
cannot exceed 25 years.
 For Perkins or HPSL, you should contact your lender.
Income-Based Repayment Plan (IBR)
StudentAid.ed.gov/IBR
 Based on your income and family size;
 AGI-150% federal poverty level=discretionary income. You pay
15% of the discretionary income.
 For example, 150 percent of the 2011 HHS poverty guideline
amount for a family of three in the 48 contiguous states and
the District of Columbia is $27,795. If your AGI was $40,000,
the difference would be $12,205. Fifteen percent of that is
$1,831; dividing this amount by 12 results in a monthly IBR
payment amount of $153. this compares with a monthly
payment amount of $518 under a 10-year Standard
Repayment Plan (based on an eligible loan debt amount of
$45,000).
Income Based Repayment
 You may pay more interest. Reduced payment
generally extends your repayment period.
 You must submit annual documentation
 Government pays interest on Subsidized Loan up to
3 years.
 Forgiveness for payments made over a period of 25
years. You may pay taxes on any loan amount that is
forgiven after 25 years.
 https://studentloans.gov/myDirectLoan/mobile/repay
ment/repaymentEstimator.action
Pay As You Earn (PAYE)
 based on your income and family size; 10% of
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discretionary income
adjusted each year, based on changes to your annual
income and family size;
If your PAYE payment amount doesn’t cover the interest
that accrues on your loans each month, the government
will pay your unpaid accrued interest on your Direct
Subsidized Loans
never more than the 10-year standard repayment amount;
Forgiveness for payments made over a period of 20 years.
Differences between PAYE and IBR
 PAYE capped at 10% of discretionary income (IBR is
15%)
 PAYE can't qualify if loans borrowed prior to 2007
 PAYE has loan forgiveness after 20 years (IBR is 25)
 Only loans made under the Direct Loan Program are
eligible for PAYE, but both Direct Loans and Federal
Family Education Loans (FFEL) are eligible for IBR.
 You may have to pay income tax on any amount that
is forgiven.
Consolidation
 Consolidation is the process of combining two or
more loans into a single loan with a single set of
monthly payments.
 The interest rate for a consolidated loan is fixed for
the life of the loan.
 The fixed rate is based on a weighted average of all
of the loans that you choose to consolidate.
 You can consolidate during your grace period or
during periods of deferment or forbearance. You can
also consolidate once you’ve entered repayment.
Consolidation: Pros and Cons
 Pros:
*Your monthly payment might be lower. One monthly bill. You will
receive a fixed interest rate.
*You can take a longer time to repay (up to 30 years).
Cons:
*Extended repayment mean more interest paid over the life of the
loan.
*Once a loan is consolidated, it cannot be revoked. It is not subject to
the same terms of the previous underlying loans. Consider the
impact of losing any borrower benefits offered with the original
loans. Borrower benefits from your original loan, which may include
interest rate discounts, principle rebates, or loan cancellation.
Credit Report
 The three nationwide consumer reporting companies
(Equifax, Experian, and, TransUnion) allows you one
free copy of your credit report once every 12 months.
 To order visit www.annualcreditreport.com or call 1877-322-8228.
Remember
 • Make a budget and stick with it.
 • If you don’t understand something, call your loan
 holder or loan servicer or your financial aid office.
 • Keep all student loan documents in a file.
 • Open all your mail and read everything pertaining
 to your student loans.
 • Keep in contact with your loan holder or loan
servicer and keep your address current.
 • Make all regularly scheduled payments.
OSFA Contact Information
Office of Student Financial Aid (MC 334)
Room 1800, Student Services Building
1200 West Harrison Street
Chicago, Illinois 60607-7163
Phone: (312) 996-3126
E-mail: [email protected]
[email protected]
Web Site: www.financialaid.uic.edu
(Select “Financial Aid” option)
Questions?????