Student Loan
Grace Period
Begins the day after a student stops being enrolled at least half- time at an eligible school. Students are not required to make any payments on a loan during this time.
College loans will cover for these expenses
Tuition, room and board and book expenses
Loan Consolidation
When you combine all of your student loans into one new loan so you will only have to make one payment. It can add years to your repayment plan which means you pay more interest. It's beneficial to pay more than the minimum payment to reduce your debt faster.
Half Time College Students
Yo must take at least 6 credit hours a semester
Promissory Note
You must sign this agreement of a loans' terms and conditions. It basically indicates that you agree to pay the loan back.
Student Loan
Money you borrow for school and must repay with interest.
Full Time College Students
Must take at least 12 or more credit hours per semester
Delinquent
Your loan is called this the first day after you miss a payment.
5 Steps to be taken towards paying for college
1. Choose Schools 2. Submit the FASFA 3. Award Letters 4. Fill in the Gaps 5. Make the right loan decision.
Deferment
A period during which repayment of the principal and interest of your loan is temporarily delayed.
Interest
Cost to borrow money. Calculated as a percentage of the outstanding balance.
Default
Failure to make your payments on your student loan as scheduled according to the terms of your promissory note, the binding legal document you signed at the time you took out your loan.
FAFSA
Free application for Federal Student Aid.
Forbearance
If you can't make scheduled loan payments but don't qualify for deferment, this may allow you to stop making payments or reduce your monthly payment for up to 12 months. Be aware that a penalty will be involved.
Stafford Loan
Requires no collateral, has low interest rate and must be repaid beginning 6 months after graduation. Minimum you can borrow your freshman year is $2,625 & up to $5,500 your senior year.
PLUS Loan
offered to parents of dependent students who require financial assistance. Low interest rate and repayment begins 60 days after final loan payment.
Repayment Period
The maximum time period over which you must pay your federal student loan. This may range from 10 years to 30 years, depending on the loan amount and type.
Expected Family Contribution (EFC)
The number that's used to determine your eligibility for federal student aid. This number results from the financial information you provided in your FAFSA application. Your EFC is reported to you on your Student Aid Report (SAR).
What happens if you default your loan
This will damage your credit score which can lead to problems financing a car or home in the future.
Perkins Loan
based entirely on financial need. Max amount a student can borrow during undergraduate year is $4,000. Low interest rate and repayment starts 9 months after you graduate from college.
