As the deadline approaches for the first payment on our student loans, I’ve been getting an increasing number of official looking letters - I always rush upstairs to tear them open, worried that Ive missed a deadline or forgotten a form, to discover that they are just advertisements - advertisements for debt consolidation.

While its true that we’ll likely be looking into consolidation of some sort down the road -  as I understand it, it usually makes sense - I’m pretty put off by the sneaky tactics these loan consolidation companies are using.  How many people get duped and think they’re calling the government or the private entity they’ve taken out a loan with when in reality they’re calling a debt consolidation company?

I’ll be looking long and hard before we choose a company to consolidate our loans - anyone who is willing to trick you to get you in the door will have no problem lying to you once youre a customer.

My wife graduated last May, and we’ve really been dreading the next few months - we know that her student loans will be due soon, but we don’t really know when, or what will happen. Finally we got a statement in the mail today giving us more information and a deadline.

FAFSA, short for the Free Application for Federal Student Aid, is the application form for federal studnt grants, work study aid, and loans. In some msituations, the application can be used to apply for private aid as well. In short, its a big deal, and everyone looking to receive some form of financial aid for college will likely need to fill one out.

Because of its popularity, there are many methods available for filling out the FAFSA.

An option common with graduating high school seniors is the Electronic Data Exchange for schools. High schools often provide a method for students to complete and enter their FAFSA forms to ensure they are done correctly, and in a timely manner.

You can also complete a FAFSA application on the web - simply go to http://www.fafsa.ed.gov, and follow the instructions there. If you need to renew your FAFSA application, this is where you do it.

You can complete it on paper and mail it in, ensuring that even if you dont have an internet connection or a school which participates in the Electronic Data exchange, you can still apply.

The FAFSA is also available in Spanish.

There are a few different deadlines to keep in mind when filling out a FAFSA form: First, there are School aid deadlines - these are the deadlines a school imposes for students requesting aid from them. Second, there are Federal student aid deadlines. These can be viewed by clicking here. Last, there are State student aid deadlines. These vary by state, and are often earlier than the Federal deadlines. To be safe, always try to submit your FAFSA application by early January.

We’ve all heard of both federal and private student loans, but what is the difference, and how does the difference affect your ability to pay off the loans quickly? First, we’ll look at federal student loans.

Federal Student loans are a great starting point to fund a college career - with interest rates relatively low (under 10%, with some as low as 5%), they are a comparatively inexpensive source of money. There are 5 different types of federal student loans: Federal Perkins Loans, FFEL Stafford Loans, Direct Stafford Loans, FFEL PLUS Loans, and Direct PLUS loans. As a student or graduate, you should probably only worry about Perkins and Stafford loans, as the PLUS loans are granted to parents of students.

Federal student loans come in 2 flavors: subsidized and unsubsidized. Subsidized student loans are only available in the Stafford Loans. If you have a subsidized Stafford loan, you’re in luck - this means that the government has been paying (and will continue paying, if you’re still in school) the interest on your loan. You wont be responsible for the interest payments on your student loans until repayment begins, which usually happens about 6 months after graduation. If you find that your loans aren’t subsidized, don’t fret - while you are certainly going to be paying back more than you borrowed, you can alleviate the situation by paying interest payments along the way. The interest is compounding, so each month’s interest is added to the principle amount used to calculate the next months interest charge - In simpler terms, every month you pay more interest than you did the previous month. Paying off interest while you are still in college is a great way to minimize the impact of this effect.

Who am I paying back?

With Federal student loans, you’ll either be paying back the U.S. Dept of Education, a private lender (bank, credit union, etc.), or your school, depending on the type of loan.

When are payments due, and how long is the repayment period?

I’ll get into this more with an upcoming series on specific federal student loans, but for now, here are some generalizations: the Perkins loan allows only up to 10 years to pay, and the Stafford loans permit repayment times of 10 - 25 years. Most loans become due within 6 months of graduation, but special circumstances can apply.

Welcome to Student Loan Debt Help .net! This year, tens of thousands of students will graduate high school, and a huge number of them will be staring down their student loans. Many finish college with outrageous amounts of debt - enough to overwhelm nearly anyone.

I have a fair amount of student loan debt myself - and I want to be rid of it. What are my options? Who can help me? How? Most students never learn these things, and as a result, struggle endlessly with their debt payments. I’m putting this blog together as a resource of practical information that students who need loan debt help should know before grabbing that diploma and heading off into the real world.

Ill be focusing on these topics:

• Understanding your loans:

When applying for student loans, most people don’t look too closely at what they’re signing up for, or what it means to them.  With repayment dates years in the future, it seems like a great thing to think about later.   Well, later is now.  Let’s figure out exactly what we owe, to who, and what the terms are.

• Understanding your options:

I routinely get official looking mail that tells me frightening facts about how soon my student loans will become due - and usually, I’m 3/4 of the  way through the material before I realize that what Im reading has come from a third party who is looking to offer me a product or service.  What exactly are my options?  What do I need to know before I start signing contracts?

• Understanding how to get rid of the debt quickly:

Budgeting is rarely a skill that is perfected in college.  It’s boring, difficult, and frustrating.  However, with a little foresight and  some logic, paying off your debt quickly and intelligently is a completely attainable goal.

My name is Peter.  I’m 22 years old, I don’t have a lot of money, and I have a wife who just graduated from college.  This is great -   I’m excited for her achievement, as well as her new, increased earning power.  In spite of all that, we’re a little worried - we now have to face a problem that a huge number of young people have to face:  Student Loans.
The cost of education is ever increasing.  According to the National Center for Education Statistics, just over 35% of all undergraduate students received student loans for the 2003-2004 school year, with an average loan amount of $5800, not including some types of loans, including Federal PLUS loans (which are technically in the parent’s name).  Assuming that a student is able to graduate in 4 years, they are looking at a whopping $23,200 in student debt immediately out of college.  As credit cards become increasingly available, especially to young people, these same students often find themselves carrying thousands in credit card debt.
Knowing that my wife and I are facing a problem that is far from uncommon to people our age is encouraging. We’ll pay the debt off and move on wiht our lives - unfortunately, we know very little about the debt.  The specific loans, the actual amount owed, when it is due, and what the monthly payments will be - I don’t have a clue about any of this, and I suspect that many recent college graduates feel the same way.
I plan to find out.  Our debt is large, so its certainly worth our time to learn everything we can about the situation and make informed, intelligent decisions about how to handle it.  As I learn more, I’ll post it here - tips, information, how to find information relating to your specific situation, and more.  Stay tuned, you just might learn something!