Page 19 - HIWT Summer 2016 World of Welding

Loan Options And Managing Debt

The balance between deciding what loan type to acquire and Parents can obtain a Federal Direct PLUS Loan to assist their
borrowing what is needed versus borrowing what is allowed dependent student with cost of education not covered by student’s
can be challenging. Once a student has exhausted all resources awarded aid. Repayment begins within 60 days of being fully
of scholarships and grants, many students need to explore loan disbursed. Parents may delay repayment while the student is
options to complete the funding of their education. As well as cover enrolled in school; however interest will continue to accrue.
the cost of their living expenses during their time of enrollment. The Parents are solely responsible for repayment – not the student.
following are some loans that are available: Federal Direct Parent PLUS Loan – The PLUS Loan is awarded based
on the approved credit of the parent (biological, adoptive, or in some
Federal Direct Loan (William D. Ford) – Direct Subsidized, cases stepparent) of dependent students attending an accredited
Unsubsidized & Parent PLUS Loans institution full time. If your application is denied, the student can
The William D. Ford Federal Direct Loans are low interest loans request additional unsubsidized loan funds.
designed to provide eligible students and parents with additional
funds borrowed directly from the U.S. Department of Education to Alternative Lending
assist in paying for education cost not covered by other sources of When federal aid is not enough, private loans are available to fill
aid. To qualify, you must be attending a accredited institution, full funding gaps. These loans are not guaranteed or subsidized by the
time in an approved program and you must complete the FAFSA government. Instead, they are based on credit and the credit of any
(Free Application for Federal Student Aid). The FAFSA collects co-signer. Private loans can be necessary and a cost-effective way
information to determine eligibility for grants and loans. Students to fill the gaps that federal funding leaves.
who may not be eligible for grants can still obtain Federal Direct
Loans. As you can see there are several different loan options that can
be acquired. Consider options that fit you best based on your
Students can obtain Federal Direct Subsidized & Unsubsidized educational need. The least amount borrowed the less likely a
Loans. Repayment begins 6 months after graduation, leave school or default will occur. Be aware of what repayment guidelines are for
cease to be enrolled. all loans. Borrowing only what is a needed and budgeting funds
correctly is setting you up for a positive outcome.
 Federal Direct Subsidized Loan – The subsidized loan is
based on financial need as determined by the FAFSA. The
federal government pays the interest while students are in
school.
 Federal Direct Unsubsidized Loan – The unsubsidized loan
is not based on need, which means students at any income
level can qualify. Interest will accrue
while in school, during your grace
period, and during any authorized
deferment periods. The student has
the option of paying the interest during
these times.

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