Direct Education Student Loan

Direct Education Student loans are an absolute necessity for the rather large group of people who are not able to rely on any exceptionally wealthy members of their family to cover the cost of the expenses they incur while getting a college education for them. Even if you are not able to get any scholarships or private sources of money to be used for education purposes, you can receive direct student loans from private and government sources and use these to pay for your schooling.

Fortunately, the majority of direct student loans do not have to be paid off until you have graduated from college. These loans are also designed to be moderately easy to pay off; it just requires some good financial planning. Done correctly, you can eliminate your student loans just a few years after you graduate.

The direct student loan consolidation service can help individuals who find themselves overwhelmed with high cost, high interest student loans or deep in uncontrollable credit card debt, even if they don’t have a job. This service is basically an additional loan that consolidates all of your current student loans while also getting you a better interest rate. That will allow you to rearrange your finances and get them back under control.

The Direct student loan program started approximately 15 years ago and was intended to cut out the middle man so that, instead of involving banks, credit unions and other private lenders, the Federal government loans the money directly to students and parents.

Direct loan programs overlap the alternative which is called the FFELP, or Federal Family Education Loan Program, which is a program designed to work through a network of private lenders. Since direct loan programs duplicate in many ways the FFEL programs, it is important to decide which program you want. Both programs offer both Stafford and PLUS loans.

If you are thinking about applying for a direct student loan for the upcoming school year, now is the time to prepare your documents for the application process. Funding through the U.S. Department of Education is awarded after the successful completion of the Free Application for Federal Student Aid (FAFSA). The FAFSA is a lengthy application that requires a lot of information about you and your parents (if you are considered a dependent).

Applying for a direct student loan online is the fastest and least painful way to go about filling a FAFSA. Before you begin, however, you will need a PIN. You will also need some documentation to answer specific questions on the application.

Perhaps the most important difference for the majority of lenders however will be the difference in rates, repayment terms and fees between the two. Here you need to remember that while the interest rates on Stafford and PLUS loans are officially fixed private lenders do enjoy some flexibility in other areas.

They might or might not for example charge both origination and insurance fees, which are currently assessed at 3% and 1%, according to Federal rules. Though these charges will still be applied to your loan, a private lender might agree to absorb these in order to get your business. They might as an example choose to alter the dates on which interest charges are calculated or to either extend a grace period or increase your repayment period.

Be Sociable, Share!