When It Comes to Student Loans, Forget Everything You Knew

As you get your children ready for the college admissions system, you may be perplexity what all the financial aid fuss is about. After all, when you attended school, you dont remember student loans being consonant a big deal. Well, if your last encounter with financial aid was when you graduated from college yourself, here are two words of advice: Brace yourself.

Parents of prospective college students will double time find that health care reform and student loans have a lot in standard, at premier legislatively words. The health care correct package passed earlier this year contained ultra of larger changes to the way the federal government distributes and manages government - issued student loans.

In addition, earlier legislation from the past three years aims to bring more transparency to college costs and to make student loans easier to repay. New provisions designed to help families read the true cost of a college education will put more information in the hands of college consumers.

All of these factors mean the upcoming financial aid season will have prohibitively of new twists and turns in store for students and their families.

>> The Revamping of Student Loans

So whats new on the student loan horizon? One of the biggest changes involves the way the federal government doles out student loans.

The Obama administrations health care reform package contained within it the Student Aid and Fiscal Responsibility Act ( SAFRA ), which brought about arguably the most sweeping and extensive changes to the federal student loan program in over a decade, completely eliminating the third - party lender system that had been in place since 1965.

Under the third - party lender system, known as FFELP ( Federal Family Education Loan Program ), banks and other private lenders, acting as a middleman, played a major role in distributing and managing federally guaranteed student loans, originating 78 percent of all new federal college loans. But as of July 1, 2010, FFELP has ceased to exist, and private lenders may no longer issue federal parent or student loans on behalf of the government. Instead, students will go directly to the Education Department for all federal student loans, parent loans, and graduate loans.

Private lenders can still issue private student loans, however, which arent guaranteed by the federal government and which can carry higher interest rates than their government - backed counterparts, particularly for those student borrowers who have weak or less - established credit. Students are cautioned to exhaust all their federal financial aid options first before seeking out private student loans.

>> Making Student Loans Easier to Repay

SAFRA and other recent legislation has also made it easier for borrowers to repay their federal college loans.

The College Cost Reduction and Access Act of 2007 created a new student loan repayment plan, income - based repayment, which became available on July 1, 2009. Borrowers who qualify for income - based repayment have their student loan payments capped at 15 percent of their discretionary income.

Additionally, borrowers who make payments on their student loans under the income - based repayment plan for 25 years will have any remaining student loan balances forgiven. This forgiveness period is only 10 years for any borrowers who are in the military or who work in the public service sector.

SAFRA expands the benefits of the income - based repayment program, lowering the cap on monthly student loan payments from 15 percent to 10 percent of a borrowers discretionary income and allowing remaining student loan balances to be forgiven after 20 years instead of 25. These updates to the income - based repayment plan become effective in 2014.

>> Federal Grants and the Cost of College

Another new twist? Under SAFRA, the federal Pell Grant program has been remodeled and updated to provide more grant aid to lower - income students. Beginning in 2013, the new - and - improved Pell Grants will be tied to the cost of living, so that award amounts keep pace with inflation. The maximum Pell Grant award is $5, 550 for the current 201011 academic year and will rise to $5, 975 by 2017.

Families who have had a difficult time figuring out exactly how much college will cost are about to get a break - - and quite possibly a big shock. The Higher Education Opportunity Act of 2008, which reauthorized the original Higher Education Act of 1965, contained new provisions that take effect in 2011, requiring colleges and universities to disclose their full cost of attendance, not merely tuition costs. Institutions must also estimate the amount of financial aid, including grants, college loans, and other financial resources, an applicant would need to receive to pay for one of their college degrees.

Whatever the specific changes that may affect you and your college - bound children, one thing is certain: Mounting student loan debts and the unabated rise in the cost of a college education are having an effect on the way the federal government distributes student financial aid. And the best way to navigate the changed financial aid landscape is to talk to your schools financial aid office, research your financial aid options, and be sure to apply for federal financial aid, regardless of your income or financial situation. You never know what grants and college loans you and your children may qualify for.

When It Comes To Your College Planning, Are You Being A But - Head

I need to look at colleges... " but " I don ' t have time.

I should have studied for the SAT... " but " I had a celebration to go to.

I want to go to college... " but " I ' m not making the time to find the colleges.

I want to large in zzz... " but " I case Costalotta U. common though they don ' t offer zzz as a dominant.

Hunk of these sound recognized? Sublet ' s be above board, you ' ve likely oral at first off one of these - in some form or another - at one time or another. It ' s human nature, we ' re all " but " heads - what we ' re " but " s about just changes as we get older. ( My current " but " head moments center around losing weight - " I want to lose 15 pounds... " but " I don ' t want to change the way I eat " )

Parents, your students aren ' t the only ones who can be " but " heads.

Sending our child to college is important... " but " we can ' t start until after our vacation.

Sending our child to college is important... " but " we haven ' t saved anything.

Sending our child to college is a priority... " but " we don ' t have enough money for one year let alone all four.

Sending our child to college is important... " but " we ' re spending $5, 000 + per year on sport travel teams, etc.

We need help with all of this... " but " we don ' t have the money.

Whether you ' re a student or a parent, if college is as much of a priority as you say, then action needs to be taken. Thinking about it or hoping things will change won ' t actually make it so. College is all about decisions.

Being a " but " - head will sabotage your results. If you find yourself saying you want one thing and then uttering " but " then the first step to getting the results you want is to break this habit.

If you don ' t make decisions or put off making them until it ' s nearly too late, don ' t be surprised when you don ' t get in to a particular college or are not offered a lot of scholarship or financial aid.

Your Smart Plan For College Assignment:

Be honest with yourself and see if you ' re saying " but " a bit too much. You need to stop this habit now. Start making decisions. Yes, they ' re scary. Yes, they have consequences, but without them, your college dreams and goals won ' t happen.

Make a decision - indecision is a form of self abuse. There are only about 2 % of things in life we actually ever need to " think " over. We know what we need to do - we are just too chicken to do it, so we wait. Make a decision and move on.

Why Students Should Choose a Christian Based Education When It Comes to Selecting a College

When choosing a college many students thin towards an education that provides them with a powerful spiritual foundation as hale as an academic one. The importance of faith based learning has emerge as more of a priority than before. Students are looking to expand their horizons, enhance their professional lives and strengthen their Christian beliefs. Students who want an stress on Christian beliefs are turning towards Christian based colleges when selecting a school for higher learning.

A college education is more than an unique choosing a larger, earning a degree and preparing them for a professional career. It ' s also about instilling values, morals and creating a confident, sane rounded and mature adult to become a prominent member of society.

When it comes to choosing a college numerous parents and students look into schools with accreditation, high academic standards and more common than not, Christian based education. Christian colleges provide students with a learning environment very similar to non - Christian colleges along with the emphasis on Christian principles to assist in making each student functional Disciples of Christ. The purpose of a Christian education is to not only educate individuals in fields necessary for their professional lives, but to integrate the importance of their relationship with God.

Students who choose Christian colleges continue to strengthen their spiritual maturity as well as earn their desired degree. But it isn ' t all about religion either. Many of these Christian based universities and colleges are accredited and offer honors programs, study abroad programs and leadership programs. Alongside their impressive range of academic opportunities, undergraduate and master programs, they also provide online programs for students who are unable to attend a normal class schedule, such as working professionals.

This flexibility of enhancing one ' s adult education online allows for working students to further their education without leaving their current employment. Although financial aid is available for those who qualify the option of learning online assists with various schedules. Earning an online degree is very similar to the in - class environment. The same level of education, learning materials and faculty support are available to students earning an online degree, but on a more personalized schedule.

When choosing a college consider Christian colleges as they offer a wide variety of benefits to students, from their wide range of academic opportunities to their emphasis teaching Christianity. Take your faith and education to a higher level when choosing a college. Christian colleges provide individuals with a strong foundation in spirituality along with an exceptional education from an accredited school.