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  • drdianehamilton 4:05 pm on April 26, 2012 Permalink | Reply
    Tags: Barack Obama, , Federal Family Education Loan Program, Jimmy Fallon, , Republican Party (United States), Stafford, Stafford Loan, student loans   

    Stafford Student Loans: The Obama and Fallon Jam 

    Jimmy Fallon and Barack Obama recently held a news jam session to promote keeping rates on Stafford student loans from increasing. According to Staffordloan.com “Federal Stafford loans are fixed-rate student loans for undergraduate and graduate students attending college at least half-time. Stafford loans are the most common and one of the lowest-cost ways to pay for school. Learn more about Stafford Loans.”

    To qualify for a Stafford Loan:

    • You must have submitted a FAFSA to be eligible for a Stafford loan.
    • For subsidized Stafford loans, you must have financial need as determined by your school.
    • You must be a U.S. citizen or national, a U.S. permanent resident, or eligible non-citizen.
    • You must be enrolled or plan to enroll at least half time.
    • You must be accepted for enrollment or attend a school that participates in the Federal Family Education Loan Program.
    • You must not be in default on any education loan or owe a refund on an education grant.

    US News reported, “the House will vote on a Republican bill to keep Stafford student loan interest rates at 3.4 percent. The $5.9 billion proposal would be paid for by cutting money from President Obama’s healthcare overhaul.”

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  • drdianehamilton 1:26 pm on August 13, 2010 Permalink | Reply
    Tags: BankRate, , , , creditcards, Dr. Diane Hamilton Interview, , goodstudentcreditcard, , mytwodollars, , , , pay for college, student credit cards, student loans,   

    Are You a Student In Need of a Loan? 

    There are plenty of sites offering loans for students.   I found one recently that is aimed at students who had good credit.  It is appropriately named goodstudentcreditcard.com.  This site offers some links to credit card companies and schools offering loans.    If you are looking for additional information about how to pay for college, I have written an article you might want to check out by clicking here.

    Before students automatically just apply for loans, they need to be educated about credit and be aware of issues with over-extending themselves with credit.  I wrote about this in my article for mytwodollars.

    • 76% of undergraduate students have credit cards, while carrying a balance of over $2000, according to Nellie Mae. 28% percent of students roll over their debt each month.
    • College graduates are finding that they are over $20,000 in debt, according to Creditcards.com.
    • Charles Schwab reported in a 2007 survey that 45% of teens have credit cards but only 26% know how to understand how their fees and interest payments.

    Don’t assume that just because a credit card is being offered to students that it is going to be in the student’s best interest.  New York Times featured a story about how colleges profit from marketing credit cards to their students.  Michigan State University came under fire as it was noted that they allowed Bank of America to offer advertising items to their students to sign up for banking and credit services.  In fact, according that the New York Times (2008) “Bank America’s relationship with the university extends well beyond marketing at sports events.  The bank has $8.4 million, seven-year contract with Michigan State giving it access to the students’ names and addresses and use of the university’s logo.  The more students who take the banks’ credit cards, the more money the university gets.  Under certain circumstances, Michigan State even stands to receive more money if students carry a balance on these cards.”

    I do recommend that people have a few credit cards to establish that credit.  However, they should only be used sparingly and balances paid off monthly. 

    Why get them or use them at all?  You need to establish proof that you are able to pay back money you have borrowed should you ever need to buy a major purchase such as a house or a car.  Unless you were born with Paris Hilton’s trust fund, I highly doubt you will be able to come up with $200,000 in cash for a house. 

    When you do need to borrow a large sum of money like that, the bank lending it to you will want to see that you have a strong credit history.  That is why it was important for you to have paid 3 or 4 different credit cards on a timely basis.

    When you get a credit card, be sure you know the interest rate you are paying.  Sites like http://www.Bankrate.com show you different types of cards that are available and the rates they charge.  If you have a high rate already on a card you have, you can transfer your balance to another credit card with a lower rate.  This may be a good idea should you find a card with better rates and fees.  Just be sure that once you transfer your money, that you do not close out your old credit card.  Just leave it open and don’t ever charge on it any more.  It actually hurts your credit score to close out old credit card accounts.

    To hear my recent radio interview where I discussed personal finance issues for the young adult, click here.  For more information about personal finance for the young adult, click here.

  • drdianehamilton 9:56 pm on July 24, 2010 Permalink | Reply
    Tags: Arne Duncan, , debt to income ratio, , , student debt, student loans, U S Department of Education,   

    U.S. to Scrutinize For-Profit Career Colleges – WSJ.com 

    The U.S. Department of Education on Friday will propose a measure to penalize for-profit career colleges for graduating students with high debt-to-income ratios.

    The proposal, which will undergo a 45-day comment period that is expected to include opposition from industry lobbyists, is an effort to ensure schools are training students for gainful employment in a recognized occupation. It comes at a time when for-profits are under new scrutiny as they capture a growing share of federal student-aid dollars.

    “Some proprietary schools have profited and prospered but their students haven’t,” Secretary of Education Arne Duncan said. “While career colleges play a vital role in training our work force to be globally competitive, some of them are saddling students with debt they cannot afford in exchange for degrees and certificates they cannot use.”

    Under the proposal, training programs would be judged on whether former students are repaying the principal on federal loans, and the relationship between total student loan debt and average earnings upon graduation. The recommendation sets up three tiers of eligibility, with those in the middle tier facing enrollment restrictions and debt-to-income disclosure requirements, and the weakest tier losing access to federal student aid for new students.

    According to the Education Department, if career colleges made no changes, 5% of all programs would no longer be eligible for federal aid and 55% would be required to warn students about high debt-to-income ratios. Many publicly traded schools derive close to 90% of their revenue from federal aid.

    The recommendation, known as a Notice of Proposed Rulemaking, has been a long time coming, with federal officials and industry representatives meeting for a year to discuss new higher-education regulations. The government put forth its first proposal in late January and the stocks of for-profit colleges have soared and swooned since, propelled by rumors of how programs could gain exemption from the regulation.

    The Education Department said that this version is “thoughtful,” with income calculations based on actual graduate earnings rather than Bureau of Labor Statistics figures. To give time for program improvement, the agency proposed that the 2012-2013 academic year be the earliest that programs could be found ineligible for federal aid.

    The Education Department had released 13 other proposals in June but said it needed more time for this one.

    “Some key issues around gainful employment are complicated and we want to get it right,” Mr. Duncan said at the time.

    The earlier recommendations included proposals on incentive compensation for student recruiters, a clearer definition of a credit hour and a new metrics by which students must show academic progress in order to continue receiving federal aid.

    The colleges’ programs include training for students to work in the culinary arts, as medical assistants, and in criminal justice.

    Interesting article from the Wall Street Journal . . . Those of you who have ever received a mortgage loan, know that your debt-to-income ratio is a big factor in getting your loan. That ratio shows how much you make vs. how much you spend on debt. I will be interested in seeing what they consider a high debt-to-income ratio . . .

  • drdianehamilton 2:47 pm on July 15, 2010 Permalink | Reply
    Tags: , , company scholarships, , , , Federal Aid, financial advice, , internship, , , , , online university, , , scholarship applications, scholarships, Sloan, Stafford Loans, student loans   

    Paying For College With College Scholarships and Student Loans | Online University Colleges 

    Wed, Jul 14, 2010

    Paying For College With College Scholarships and Student Loans

    It is getting harder to pay for a college education these days, but it is by no means impossible. Getting college scholarships is still the best way to go, and there are plenty of them still around – even though money may be getting tighter. Here are some tips about how to get money to pay for your college education with college scholarships and student loans.


    The best way to go to college is to go free. College scholarships can enable a student to go to college without cost – if there are enough of them. In order to get as many as is needed to go without cost, you will need to apply to as many scholarships as possible. Of course, you want to only apply for those college scholarships that you have a good possibility of actually winning.

    Finding the right college scholarships to apply to will require some work – and possibly some imagination, too. There are college scholarships for just about everything you can think of these days – and possibly some that are almost out of reach of the imagination, too. You can find them for academics, sports, hobbies, uniqueness – like a special last name or for left-handers, etc., your locale, and some that are just plain weird – like the duct tape prom college scholarship.

    In order for you to learn about what college scholarships are available, you will need to do some homework. This includes researching them online, in the library, letting scholarship groups help you (be careful of these – some are scams), talking to your school counselors, and more. You can also look at the Web sites of the colleges that you are interested in, and they will show you what college scholarships are available there.


    Many companies also offer college scholarships, too. They do this because they want to have a qualified and trained pool of potential employees available when they need them. They usually look for exceptionally bright prospects that can bring much to the table if they should hire them.

    Getting a college scholarship or an internship with a great company can lead to a great job right out of college. Sometimes, you may even be able to find your needed college scholarship simply by looking at the various companies you would dream of working for after you get your college degree. Look at their Web sites for more information.


    Because college scholarships may not cover your entire school bill, you may also need some college financing. Direct loans are available from the government, which will also give you the lowest interest rate possible on education loans.

    Direct student loans, which includes the Stafford loans and the PLUS loans, accumulate no interest while you are in school (because the government pays for it while you are in college), or drop to less than half-time. You will not need to make any payments on the loan until you have been out of school for 6 months.

    Graduate students and families of college students have access to PLUS loans for education and they also have the same terms as the Stafford loans – but a little higher interest rate. All government loans can be consolidated after graduation for easy payments.


    If you want to get the most out of college scholarships and student loans, then you will need to get started early. In fact, you should get started earlier than was necessary in previous years. With less money going around and with some college scholarships going on a first-come, first-served basis – you have no time to lose.

    Finding the right college scholarships takes a considerable amount of time, and so does filling out scholarship applications and writing scholarship essays. In addition, in order to get a Direct loan, you will need to have filled out the FAFSA form, which is required for all government student loans.


    College scholarship applications require that they be filled out accurately and carefully. A little carelessness (or haste) in answering a question or two could needlessly cost you a college scholarship. This could mean that you may need to take much longer to pay off a college loan – when you didn’t have to.

    Writing a quality college scholarship essay that will win a scholarship requires that you understand what the group offering it is looking for. Make yourself look like the person that they would like to represent and promote their company, college, etc., and you could walk away with the free college education you want. Be honest, though, in what you write – and you’ll be glad you did.

    Stay on top of everything related to student financial aid on FinancialAidFinder. The free website, from Mark B. Allen, includes a weekly summary of college scholarships and blog posts explaining how to complete scholarship applications, utilize student loans, apply for grants, and much more.

    I like the above article, but I’d like to add some more information that is from my book The Online Student’s User Manual:

    Just because you want to go back to school doesn’t necessarily mean you have the money sitting around to pay for it. Many students are looking for ways to finance their education, and options include student loans, company reimbursement, grants and scholar-ships. There are some job areas where they need people so badly that there may be opportunities where the government forgives your loan. Some of the areas where there are currently shortages include nursing, teaching, law and the military. For more information on loan forgiveness, check out the following web site: http://www.opm.gov/oca/pay/studentloan/html/fy05report.pdf. For public service loan forgiveness programs,
    check out: http://www.finaid.org/loans/publicservice.phtml.

    Some fields allow volunteering your time to count toward loan relief. For example, check out the Ameri-Corps at http://www.americorps.org, the Peace Corps at http://www.peacecorps.gov and Volunteers in Ser-
    vice to American (VISTA) at: http://www.friendsofvista.org.

    Student loan areas to check out include the Stafford loan program. “Stafford loans are federal student loans made available to college and university students to supplement personal and family resources, scholarships, grants, and work-study. Nearly all students are eligible to receive Stafford loans regardless of credit. Stafford loans may be subsidized by the U.S. Gov-ernment or unsubsidized depending on the student’s need.” (Staffordloan.com, 2010).

    Another program is the Pell Grant. “The Federal Pell Grant program is a federal aid program that pro-vides financial assistance to students otherwise unable to afford an undergraduate education. Your school can either credit the Pell Grant funds to your school account, pay you directly (usually by check), or combine these methods. The school must tell you in writing how and when you’ll be paid, and how much your award will be. Schools must pay you at least once per term (semester, trimester, or quarter). Schools that do not use formally defined, traditional terms must pay you at least twice per academic year” (college-scholarships-grants.biz, 2010).

    There are other ways to help pay for your online education on your own. According to eLearners.com (2010) you should speak to your financial advisor about the possibility of using:

    1. Personal savings
    2. Credit cards
    3. Funds borrowed from your 401k or Retirement Plan
    4. Funds borrowed against a life insurance policy
    5. A line of credit or HELOC (home equity line of credit)
    6. A family loan or gift
    7. Loans from the traditional lending agencies such as Sallie Mae at http://www.tuitionpay.com/ or Tuition Man-agement Systems at http://www.afford.com or FACTS Management Company at http://www.factsmgt.com/FACTS/Family.

    The most important first step is to talk to your school’s financial advisors to find out what options are available to you. For more information about completing the ap-plication for federal student financial aid, be sure to check out http://www.fafsa.ed.gov/. If you are not fa-miliar with FASFA, “Today, Federal Student Aid performs a range of critical functions that include, among others:

    • Educating students and families on the process of obtaining aid;
    • Processing millions of student financial aid applications each year;
    • Disbursing billions of dollars in aid funds to students through schools;
    • Enforcing financial aid rules and regulations;
    • Servicing millions of student loan accounts, and securing repayment from borrowers who have defaulted on their loans; and
    • Operating information technology systems and tools that manage billions in student aid dollars” (federalstudentaid.ed.gov, 2010).

    Do not get discouraged, because there are many loans and finance programs out there. “During the 2006–07 academic year, more than $130 billion in financial aid was distributed to undergraduate and graduate students in the form of grants from all sources and federal loans, work-study, and tax credits and deductions. In addition, these students borrowed more than $18 billion from state and private sources to help finance their education” (collegeboard.com, 2010). I recommend that you download the most recent Trends in Student Aid report from <a href=”http://www.collegeboard.com/prod_downloads/about/news_info/trends/trends_aid_07.pdf.


    • Trish Wilkinson 3:58 pm on August 10, 2010 Permalink | Reply

      We are researching colleges and financing help at the moment for our two teenage girls. Thanks for the tips!

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