Big changes came to the bigger education loan market as a result of the Wall Street melt down. Well before the pyrotechnics of failing lending institutions and government bailouts, many students have felt the credit crunch because they returned to school to locate that they had to scramble to locate new lenders willing to service their student loans.
CampusDoor, students lender that has been backed by the failed Lehman Brothers, had to share with students that the private loans they had been approved กรอ for would not be funded. Based on Sallie Mae, 70 private lenders have left the student loan market in 2008. Several of those lenders have suspended business in the bigger education loan market and others have suspended loan programs with colleges which they consider to become a high risk, however, many lenders have gone out of business all together.
Here’s the thing you need to learn to get the amount of money you’ll need to complete your educational goals:
Help is on the way
* The U.S. Senate passed the Ensuring Continued Access to Student Loans Act that will allow the Secretary of Education to get loans from private institutions. This move should raise the liquidity of those lenders, letting them loan more cash to students.
* The Ensuring Continued Access to Student Loans Act also changes the terms of repayment for PLUS loans. Under the current terms, parents must begin repayment 60 days after the disbursement of funds. Going forward, parents will have the choice of deferring repayment for approximately 6 months after students leave school.
* The newest act also escalates the loan limits on fixed rate, no credit check Stafford Loans. This move was aimed at helping students cut costs by foregoing higher priced private student loans.
Creditworthiness is vital
* Guard your credit! As lenders work to shore up their bottom lines, credit worthiness is paramount. Alternative loans, which are credit based, might be an alternative you’ll need to think about with the rising cost of tuition. If you do not have good credit, you might have to discover a co-signer.
Complete the FAFSA to qualify for the all the financial aid available to you
* Higher education loan eligibility is set based upon the information within the FAFSA or Free Application for Federal Student Aid.
* Completing the FAFSA will determine your eligibility for grants scholarships and work-study as well as student loans. Broadening your financial options is likely to make more funds available for education expenses.
* Ensure that you contact an economic aid adviser at the college or career school that you plan to attend. Schools are expected to share with you of their financial aid procedures and deadlines. They are able to also inform you of other kinds of financial aid, such as state programs of school based scholarships.
Understand that the unprecedented financial crisis affecting the bigger education loan market is continually fluctuating. The easiest way to be sure that you have the funds that you’ll require will be informed of the changes and how they affect your financial goals.