Your parents will tell you, “a penny saved, is a penny earned.” In today’s economy, saving as many pennies as possible is more important than ever. Savvy consumers price shop for everything – even milk. The same should be true for private student loans. There are a number of banks and other lenders that make credit-based education loans available to students, but how do you actually get the best rate? Well, of course we’ll tell you the best place to start is by comparing student loans using our LoanFinder. However, we’re leaving the choice of lender up to you, the borrower. We think we can do better so without further ado, here are seven things you can do to ensure you get the best rate on your student loans.
Private student loan borrowers who are struggling to repay their loans may soon get some relief thanks to new programs being rolled out by two of the largest private lenders in the country. Wells Fargo and Discover Financial Services both have announced plans to offer private student loan modification programs to their existing clients. This is definitely a shift since private student loan providers typically do not offer many options for those having difficulty paying back their debt. In fact, the Consumer Financial Protection Bureau (CFPB) saw a 38 percent increase in complaints regarding private student loans this past year. The majority of the complaints dealt with repayment options and lack of flexibility in restructuring loans, according to the CFPB annual report released in October. Although private student loan lenders receive quite a bit of harsh treatment in the press, it’s interesting to note that private student loans only account for eight percent of the total $1.15 trillion in student loan debt. Lenders, however, are listening to both the CFPB and consumers, and are taking steps to help those facing financial hardships. Could you be eligible for one of the new private student loan modification programs? If you have a current loan with either Wells Fargo or Discover, here’s what you need to know.
Have you been applying to scholarships for a while now, but don’t seem to be having any luck? We’re betting that there are plenty of students who can commiserate with you. We know it can get downright frustrating to send out 5, 10 or even 20 applications without any results. Of course, there are always a few students who seem to have money falling out of the sky (insert evil glare here). So, what gives? Do they have an inside connection or have they paid off the scholarship committee? It’s doubtful. In fact, those students probably have many of the same qualities you possess. They do, however, have one thing you don’t…the secret to winning scholarships. So, do you want to know how they win all that free money? Read on!
Here’s a news flash…college is expensive. No big surprise, right? But what is surprising is how few families with children under the age of 18 are currently saving money for college. Approximately half are setting aside money in a dedicated account for their children, but most are saving less than $16,000 overall. Even at today’s tuition rates, that’s not going to cover very much. Now, here’s the really scary part. Families with newborns can expect to pay more than $442,000 for a 4-year undergraduate degree when their children graduate from high school, if tuition continues to increase at a rate of 7% per year. That means, families would need to set aside approximately $875 every month in a college savings plan to help their children graduate with as little debt as possible. For many families that may not be feasible, but any amount saved would be better than nothing at all. Of course, the earlier families start planning and saving for college the better. That’s why this week’s post will be dedicated to reviewing some of the available college saving options for parents, as well as some other less conventional methods families can use to set aside money to help their children pay for college.
Occasionally, I get questions from parents and students regarding financial aid, especially when it comes to filing the Free Application for Federal Student Aid (FAFSA). Most are worried that they make too much money to qualify for any grants or scholarships, and want to know if they should even bother completing the form. And, in case you’re wondering…yes, everyone, regardless of income, should complete the FAFSA. Others, however, seem to be a bit confused as to what income should even be included on the form. So, I thought it might be a good time to tackle a comment from one of our recent posts. Laura writes:
“When my son graduates, he will be 18 and we will no longer financially support him. What we would like to know is if he would qualify for a Pell Grant?”