Transcript Allied Health Sciences Lunch, Learn, and Loans: Understanding Student Loans and Repayment Kristin Anthony – Assistant Director of Financial Aid, Office of Scholarships and.

Allied Health Sciences
Lunch, Learn, and Loans:
Understanding Student Loans and Repayment
Kristin Anthony – Assistant Director of Financial
Aid, Office of Scholarships and Student Aid
Perry Studevent – Assistant Director of Student
Services and Financial Aid, Allied Health
Sciences
Overview
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The Basics of Student Loans
Differences in Loan Types
When Does repayment begin?
Loan Servicers
Repayment Options
Consolidation
Assistance
Topics
Conclusion
The Basics of Student Loans
• National Student Loan Database System
– www.nslds.ed.gov
– www.pin.ed.gov
• Federal Loans
– Subsidized Stafford/Direct Loans
– Unsubsidized Stafford/Direct Private Loans
– Graduate Plus Loans
– Perkins Loans
• Private Loans
Differences in Loans
• Subsidized Loans: No interest accrues while
student is enrolled at least half-time. Guaranteed
by the Federal Government.
• Unsubsidized: Interest accrues but student not
required to make payments until they leave
school. Guaranteed by Federal Government.
– Begins accruing interest from the time the loan is
disbursed.
• Private Loans: Can have “fixed” or variable
interest rates. Not guaranteed by the Federal
Government.
When Repayment Begins
• Private Loans
– Depends Upon Your Lender
• Federal Perkins Loans
– 9 months after last date of half-time enrollment
• Direct/Stafford and Graduate Plus Loans:
– 6 months after last date of half-time enrollment
Loan Servicers
• A loan servicer is a company that handles the
billing and other services on your federal
student loan. The loan servicer will work with
you on repayment plans and loan
consolidation and will assist you with other
tasks related to your federal student loan. It is
important to maintain contact with your loan
servicer.
Repayment Options
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Consolidation
Standard/Graduated
Income-based
Pay as You Earn
Income-Contingent
Forgiveness, Cancellation, and Discharge
Know your loan history:
www.nslds.ed.gov
Definitions: Consolidation
• Simply combining several
loans into one:
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Review your current federal student loans
– Check your student loan account online, review your loan documents or contact your lender or
loan servicer. If you don’t know who your loan servicer is, you can find out at
www.nslds.ed.gov.
– Once you consolidate, that loan is locked. You can add other loans to it later, but it cannot be
changed.
– Most loan repayment incentive programs require consolidation of you loan.
Types of Payment Plans
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Standard/Graduated
Extended
Income Based Repayment
Pay As You Earn
Income-Contingent Repayment
Income Sensitive Repayment
Standard/Graduated
• Standard: Payments are fixed amount of at
least $50 per month
• Graduated: Payments start low and increase
over time.
• Standard: Pay the least amount of interest
over time.
• Graduated: Pay more in interest than a
standard repayment, but less than an
extended plan.
Extended Repayment Plan
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Payments fixed or graduated
Lower monthly payments
Have up to 25 years to repay loans
Must have more than $30,000 for each “type”
of loan to be eligible for the extended
repayment plan.
– If you have $10,00 in Graduate Plus and $35,000
in Direct Unsubsidized, only the unsubsidized loan
qualifies for extended repayment plans.
Income Based Repayment Plan
• Consolidation loans included.
• Must have a financial hardship.
• Maximum monthly payment will be 15% of your
discretionary income (gross income – 150% of the
poverty level).
• Payments may change as income changes.
• After 25 years any outstanding balance will be
forgiven…..BUT…..
• It is considered taxable income.
Pay as Your Earn
• Consolidation loans included.
• Must have a financial hardship.
• Maximum monthly payment will be 10% of your
discretionary income (gross income – 150% of the
poverty level for your family size and state).
• Payments change as income changes.
• After 20 years any outstanding balance will be
forgiven…..BUT…..
• It is considered taxable income.
Income-Contingent Repayment Plan
• Payments calculated each year and based on
your adjusted gross income, family size, and
total amount of your direct loans.
• After 25 years remaining balance is forgiven.
• May be considered taxable income.
Income-Sensitive Repayment Plan
• Payments calculated each year and based on
your annual income (without consideration for
family size or total amount of your loans.
• Each lender’s formula for determining
monthly payment amounts may vary.
Loan Forgiveness, Cancellation and
Discharge
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Total and permanent disability (TPD).
Death.
Teacher Loan Forgiveness
Public Service Forgiveness
Perkins Loan Cancellation and Discharge
Teacher Loan Forgiveness
• Teach full-time for five complete and
consecutive academic years.
• In certain elementary, secondary, and
educational service agencies that serve low
income families,
• Other qualifications
• Forgiveness of up to $17,500 on Direct/FFEL
subsidized and unsubsidized loans.
– Link for Information
Public Service Loan Forgiveness
• You must be employed full time (in any position) by a public service
organization, or serving in a full-time AmeriCorps or Peace Corps
position.
• For Direct Loans given after October 1st, 2007.
– Previous loans can be consolidated into a direct loan which would
then qualify.
• In general, must be on the IBR, Pay As Your Earn, or ICR repayment
plans to qualify and make 120 payments on a qualified loan.
• A government organization (including a federal, state, local, or
tribal organization, agency, or entity; a public child or family service
agency; or a tribal college or university).
• A not-for-profit, tax-exempt organization under section 501(c)(3) of
the Internal Revenue Code.
• A private, not-for-profit organization (that is not a labor union or a
partisan political organization) that provides services such as:
• Link for Information
Reminders:
• We are providing basic information, for more
detailed information please discuss with your
loan servicer. If you don’t know your loan
servicer, look them up at www.nslds.ed.gov
with your federal PIN.
• Link for Loan Repayment Information:
– http://studentaid.ed.gov/repay-loans/
Topics You Provided:
Repaying student loans (minimally) while in school.
Best loans to accept or where to find more scholarship opportunities. APTA Scholarship Information
Negotiating with potential employers for increased pay for loan repayment, or employer assisting with repayment of loans as an added bonus.
Can you take out more at a later time in the year if you decide you need more, and if so how? / Does the interest accrue the entire time you're in school for
every single loan you take out, or just for that current year that it's for?
FELS repayment, how they consider the "get a job within 6 months" aspect of forgiveness (such as, what happens if you go on maternity leave within the first
year on the job, or what happens if the job is not a good fit and you leave within a year?) I realize neither of these are ideal situations but they are not
uncommon.
Are there any loans that we are eligible for that are forgivable? How can we find out about those?
how to pay off part of the principle in addition to your monthly payment (rather than have the extra applied to subsequent payments)
working for state programs ( UNC hospital ) that will repay loans after a certain amount of time
Loan Consolidation
Preparing as an out of state student (higher costs)
compounded interest
Main Points
• Don’t freak out! Loans are investments in your
education.
• Apply for residency.
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Spring 2014: January 22nd, 2014
Summer I, 2014: May 27th, 2014
Summer II: July 2nd, 2014
Fall 2014: September 2nd, 2014
• Contact your loan servicer if you have ANY problems or
hardships.
• You can pay early without any penalties.
• If you have extra money (after expenses and saving)
apply that toward your highest interest rate item
(credit cards, student loans, car – etc.).