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Direct Lending Student Loans

December 14, 2011

Direct Lending Student Loans

Direct lending student loans are any loans that come from the William D. Ford Federal Direct Loan Program, which are set up for the purpose of providing both parents as well as students with loans that have low interest rates, compared to other lenders, especially private. The source that is acutally doing the lending of direct student loans is the US Department of Education themselves. The direct loans that are made available through the Federal Direct Student Loan Program (FDSLP) consist of:

  1. PLUS Loans – These are the loans that are designated for applicants to be either the parent or gaurdian, or in some cases the step parent or a dependable student. Direct lending student loans from the PLUS Loans program consist of borrowers paying fixed 7.9 percent interest rates with benefits that include; no early repayment penalties, interest rate discounts when enrolling in automatic debit as well as you can borrow up to the amount which you need to pay for the students education.
  2. Undergraduate Subsidized Student Loans – These are made available for undergraduate students with fixed interest rates that stand at 3.4 percent, which subsidized loans are for those who have the most financial need. These come in the form of Stafford Loans.
  3. Graduate Subsidized Student Loans – Made available specifically for graduate students, which they pay a fixed interest rate of 6.8 percent. Graduate direct lending student loans also come as Stafford Loans.
  4. Direct Unsubsidized Loans – Which these are for every applicant to apply for and has a fixed interest rate which is at 6.8 percent as well.

(Fixed interest rates are rates that will never go up or down, stay the same, throughout the life of your repayment term.)

Direct Lending Student Loans

Direct lending loans for students allow their eligible applicants to not have to pay any payments on their loan debt until after they graduate, under the circumstances that they enroll in a class schedule that is half time, which is at least 6 credits per semester.

Direct Lending Student Loans Repayment

When it comes to the repayment of direct lending student loans, the terms are the same for most all other federal loan programs, which include:

  • Standard Repayment – Repayment lasts up to 10 years which the minimum payment must exceed $50.
  • Extended Repayment – This options allow one to be able to pay their loans off over 25 years, but they must have at least $30,000 in student loan debt.
  • Graduated Repayment – This direct lending student loan option starts your payments out on the low end, and gradually go up over time, usually increasing every year or two.
  • Income Based Repayment – This program is designated to assist those who are going through a “partial financial hardship”.
  • Income Contigent Repayment – This repayment option has payments that are set up to be 20 percent of what you make each month. This options is only made available for subsidized direct lending student loans.

If you are interested in applying for direct lending student loans, all you have to do is fill out a Free Application for Federal Student Aid (FAFSA), which then your school will have the ultimate say in the amount of money you will be eligible for.

Direct Loan Consolidation Overview

November 17, 2011

Direct Loan Consolidation

Direct Loan Consolidation

Direct loan consolidation is a free service offered by the US Department of Education as a way to group all of your student loan debt into one single payment, and doesn’t require one to go through a credit check for acceptance. Consolidation of student direct loans can consist of loans programs that include; Federal Perkins Loans, Direct PLUS Loans as well as Federal Stafford Loans among near all other federal programs that offer financial aid. Direct loan consolidation was formed to both provide savings right away as well as long term, as well as provide stress relief by allowing one to only have to pay one payment instead of multiple.

Major Benefits of Direct Loan Consolidation

If you are looking to use direct loan consolidation for your student loan debt, it should be known that you should either be in the grace period provided by your lenders, or anytime after that during your repayment, as you cannot consolidate your direct loans if you are still in school. If you choose to consolidate your loans during the time of your grace period, then your grace period ends no matter how much time you have left on it, which it is suggested that you wait until your grace period is finished and then apply for consolidation. Some of the major benefits that come from using direct loans consolidation are:

  • One can enjoy a longer repayment period, which can be stretched out to up to 12 to 25 years, compared to the normal 10 year timeframe that is given for direct loans. Payments will be lower with this option, which means more interest is going to be paid in the long run, but there are no repayment penalties, meaning you can pay more than the minimum anytime you choose. Extended the repayment period has been shown to lower monthly payments by up to 53 percent.
  • Your credit score will actually go up by using direct loan consolidation as your loans will be registered as paid off as soon as you consolidate, which is view as a positive aspect by credit bureaus.
  • You will be paying on a fixed interest rate, meaning the the interest percentage that you are paying when you first start, will be the same amount until you last payment.
  • There is a possibility that the act of consolidation can actually provide a lower interest rate than that of what you are currently paying to lenders.
  • It offers flexible repayment options.
  • One can consolidate defaulted loans if in the event that they either; pay their debt off by using “income contingent repayment” or make “satisfactory repayment arrangements” through their current lender.
  • Health profession loans can consolidated as well, like for Nursing Student Loans or Health Education Assistance Loans among others.
  • You can also consolidate other existing loans that have been consolidated.
  • Multiple repayment options which include; standard repayment, graduated repayment, extended repayment, income contingent repayment and income based repayment, which you are able to switch repayment plans anytime during the life of your repayment term.
  • You can receive 0.25 percent off of your interest rate if you use their “Electronic Debt Account” which your payments will be deducted one time per month.
The entire process will usually take around 60 to 90 days to get started with consolidation, in which after the beginning of the process, one will have up to 180 days to add other loans in which they either forgot to include or left on purposely. If one chooses to use direct loan consolidation for other loans not consolidated the first time around, then they must apply for a new consolidation loan. It is also not applicable for married couples that are trying to do joint filing. The last thing your should keep in mind is that if you do choose to use direct loan consolidation while you are repaying loans, keep repaying your lenders until your lenders have contacted you informing you that the loans have been paid off.

Direct Loans Student Loans – Major Overview & Loans Offered

September 1, 2011

Direct Loans Student Loans

Direct loans student loans are offered through the William D. Ford Direct Student Loan Program with the lender of these loans being the Department of Education. Direct loans student loans are 100 percent federal loans and are offere to students as well as parents of dependable students, in the form or low interest loans as well as many other benefits that can make your college education a lot more affordable. There are different options that one can choose from that can help you attain your degree all of them are discussed in full detail below as well as the repayment options that are available to you when you start paying off your loan.

Direct Loans Student Loans

Direct Loans Student Loans Offered

There are two different types of direct loans student loans offered through the Ferderal Direct Student Loan Program (FDSLP), those are subsidized and unsubsidized Stafford student loans. Each type is discussed below:


Stafford direct loans student loans that are subsidized are given based totally off the financial need of the student, meaning those who need them most tend to get them most. These loans provide benefits to the student like:

  •  You do not have to pay any interest payments while in school as the government pays them for you, and you don’t have to pay them back if you are in full time enrollment.
  • 6 month grace periods where you do not have to pay your student loans for 6 months prior to your graduation.
  • You can defer these direct loans student loans as well which means that, which is an agreed postponement of your monthly loan payments.
  • These loans are offered at sums start at 2,625 for your first year, 3,500 for your second year, 5,000 dollars per year after you the completion of your first two years, and lastly 8,500 dollars a year for graduate students.


The ubsubsidized direct loans student loans option is not needs based meaning that it is much easier to qualify for, but it charges you with interest payments from day one, which can either be taken care of while in school, or paying them offer later when school is over. Here is the major information on unsubsidized direct loans student loans:

  • Interest rates start as low as 3.10 percent.
  • 6 month grace period is offered where you will not be charged interest as well.
  • There activation fee for the loan is 4 percent.
  • Borrowing sum totals are up to 4000 dollars for both first and second years of schooling, 5000 dollars per year after you complete your second year of enrollment which can be attained all the way up to graduate school, for graduate and professional students you can borrow up to 10,000 dollars per school year.

Direct Loans Student Loans Repayment Options

Direct loans student loans have 4 different repayment options which you can choose from, whichever one best suits what you can afford as well as how fast you want to pay it back. Here are the direct loans student loans repayment options:

  1. Standard Repayment – This option provides you with up to a 10 year repayment term.
  2. Extended Repayemnt – This direct loans student loans repayment method allows anywhere from 12 to 30 years of time for you to repay you student loans.
  3. Graduated Repayment – This option also provides a 12 to 30 year repayment plan and with this method your monthly payments increase every two years.
  4. Income Contigent Repayment – This last direct loans student loans repayment method is based on a percentage of your monthly income, usually having your monthly payments being set at 15 percent of you montly income.

Direct Loans Student Loans Deferment Options

If you want to defer your direct loans student loans, you need to prove one of the following categories:

  1. Economic Hardship
  2. Forbearance
  3. Default
  4. Disablility
  5. Unemployed

This is a main over view about direct loans student loans which can assist you in making your education more affordable and have provided millions of individuals with money to go back to school and further their education.





Direct Student Loan – Overview & Loan Options

August 30, 2011

Direct Student Loan

A direct student loan is a great resource to use when your other financial aid options like scholarships and grants are not providing you with enough money to complete your education. There are many benefits to taking our a direct student loan, which if you are not familiar with the term, direct student loans are federal loans that provide you with loans that are lower interest than private loans and can either be taken out by the student, or by the parent of a student.

To get you more familiar with the different direct student loan options, the next section will provide you with information on each one of them as well as the pros and cons to taking out a direct student loan so that you can make the descision if they are a good choice or not.

Student Loan Repayment

Direct Student Loan – Loans Offered

Below will be all the options you can choose from when it comes to direct student loans:

  1. Stafford Direct Student Loan – A direct student loan with Stafford can be found in two categories, subsidized which is a needs based loan,as well as unsubsidized which is not needs based, so it is easier to qualify for. The subsidized has an interest rate around 4.5 percent interest and the government pays your interest while in school, and the unsubsidized has an interest rate around 6.8 percent and interest starts from day one which you can pay while in schol or when you get out.  It is provided for under grads ad grad students alike and have low fixed interest rates meaning they will never change once your establish your loan program. For both options, there is a 6 month grace period, meaning that afer your graduate, you don’t have to pay monthly dues until after 6 months.
  2. Perkins Direct Student Loan – These loans are also offered to undergraduate and graduate students and all of your finances are dealt with by your schools office. Interest rates will these direct student loans are offered at slightly higher interest rate than Stafford loans. Perkins loans are dedicated to those who need it the most, like the subsidized Stafford loan, so you must prove that you are either low income, unemployed or similiar to prove that you are qualified. A Perkins direct student loan is given at 4000 a year for undergraduate students and 8000 a year for postgraduate students.
  3. Direct PLUS Loans – This direct student loan options has two that you can choose from: The Parent PLUS Loan and the Direct Graduate PLUS Loan. The Parent PLUS is for parents to take out a loan for their children and the Graduate PLUS is for graduate students shooting for a higher degree, which is not attainable by parents, only directly to the applicant. Both options allow you a 6 month grace period and have a fixed interest rate that starts at 7.8 percent. This option allows you to borrow up to the cost of your education minus any other funding you are receiving from other sources.

It should be known that not all schools accept direct student loans so it is best to inquire through your school to see if they do or not. Being that these are all federal loans, in order to qualify for any of them, you must fill out a Free Application for Federal Student Aid (FAFSA) which can be completed online or at the school that you attend.

Direct Student Loan – Pros & Cons

Now that you know all the loan options, here are a list of pros and cons so you know what you are dealing with by taking out a direct student loan.


  1. Fixed interest rate.
  2. You do not have to provide a good credit score to get a loan.
  3. 6 month grace periods


  1. With the Perkins and Stafford, you are very limited to what you can borrow.
  2. You need to apply each year for federal direct student loans.

Federal Direct Student Loans – Loans Offered & Overview

August 29, 2011

Federal Direct Student Loans

Federal direct student loans are offered through the government as a way for you to get the money you need when it comes to affording college. Knowing that those straight out of highschool or wanting to go back to school don’t exactly have the funds needed to attain a degree, The Federal Direct Student Loan Porgram (FDSLP) was designed as a way to provide low interest loans as well as many other benefits that cater to being a student usually without a job.

These federal direct student loans are offered in two categories, one being subsidized loans and the other being unsubsidized and are offered by the Stafford Student Loan program. These two options are discussed in much further detail in the next section.

Federal Direct Student Loans

Federal Direct Student Loans – Major Overview

Subsidized Federal Directs Student Loans

  • These loans are designated for those who need it most, also known as an as needed basis. These loans are given upon proof that are low income or live in a household that is low income among other speficications and these federal direct student loans allow you to not have to worry about paying interest while you are in school as the government pays you interest payments until you are finished with enrollment. With subsidized federal direct student loans, you can borrow anywhere from 2,365 to 10,000 dollars depending on where you are at in your schooling,

Unsubsidized Federal Student Loans

  • These loans are offered to anyone, unlike subsidized student loans, you don’t have to prove your need. This option charges you with interest from day one, and you can either choose pay your interest each month, or allow it to accumulate and pay it off later, although this isn’t suggested as if you do, you will pay much more then you would if you paid it off each month while you were in school. These federal direct student loans allow you to borrow anywhere from 4,000 to 10,000 per year depending on what level of education you are entering. These loans have an 4 percent activation fee meaning you pay 4 percent of your loan amount when service starts.

Federal Direct Student Loans – More Details

  • You receive a 6 month grace period with each of the federal direct student loan options above, meaning that you do not have to pay monthly payments on your debt for the first 6 months out of college. This rule also applies to dropping out or dropping below the level of half time enrollment.
  • Interest rates are found to be around 3 to 9 percent and are fixed meaning they stay the same for the entirety of your loan repayment.
  • There is no penalty for early repayment.
  • Federal direct student loans repayment plans are set at 10 to 30 years depending on which plan you choose to go with.
  • They have student loan deferrment options that can be used in the following categories; education, unemployment, economic hardship, forbearance, disability and default.

If you are intersted in using fedreal direct student loans for tuition fees, the best thing to do now would be to fill out a Free Application of Student Aid online which will show you which federal direct student loans your are eligible for.