- When will my check be at the school?
- How do I tell the State Grant Program that I want to change schools?
- Are students today borrowing more than they can afford to repay when they graduate?
- How do I get a loan?
- What type of government loans are available?
- Which is better, the SELF Loan or the Unsubsidized Stafford Loan?
- What is a deferment?
- What are my loan repayment options if I can't find a job after I graduate from college?
- Besides unemployment, what other deferment opportunities are there?
- I have several different student loans, so I'm making more than one payment. Is there a way to merge my loans so I have only one monthly payment?
Generally, schools disburse funds within the first two weeks of the term.
If you plan to attend more than one institution in the same term, your State Grant award will be split between those institutions depending on your registration load at each institution. Each institution is responsible for calculating the amount of State Grant you receive. You must make sure that a copy of your federal aid application is sent to each school you will attend. You can do this by listing the school code on the FASFA application.
Some are and some are not. The Minnesota Office of Higher Education monitors debt trends and evaluates state financial aid policies.
- Rising debt loads is a concern and is caused in part by rising tuition
- If the student borrows money to get through school faster and into the workforce, that can be productive
- As of July 1, 2008, the federal government increased the amount of money that students can borrow and made all students eligible to borrow.
- From 1987 to 2009, the increase in borrowing was greater than the increases in both tuition and inflation.
- The default rate on student loans is fairly low. 5.8 percent of Minnesota students who were due to begin repayment in 2009 defaulted on their loans.
Check with your school's financial aid office. There are different types of student loans with different criteria and different application methods. You can also learn about loans in the Paying for College section of our website.
The Subsidized Stafford Student Loan is a need-based program and is awarded to those students with the greatest financial need.
The Unsubsidized Stafford Loan is available to students who do not show financial need. The student has a choice of either paying the interest on the loan while in school or having it added to the loan principal for payment later. The Unsubsidized Stafford Loan can be included in federal loan consolidation programs or the U.S. military loan repayment program.
The state of Minnesota also has a loan program, called the SELF Loan that is not based on financial need. The student must pay the interest while in school. The interest rate varies quarterly throughout the life of the loan. SELF requires a credit-worthy co-signer. The dollar amount of a student's SELF Loan debt can be used to determine the length of repayment of a student's federal loan consolidation, but SELF loans cannot be included in a federal consolidation.
There are advantages and disadvantages to both programs. The student and family should learn the facts about each program, and decide which program can best help them. The school's financial aid office can help you learn some of the differences. Discuss the differences with your school's financial aid office to help decide which one better suits your needs.
Deferment is a temporary stopping of interest and/or principal payments. All deferments must be applied for and approved before they go into effect.
The deferment periods have different lengths, and all require some form of documentation before they will be approved. For more information, check with your loan servicer or lender.
First, you have a six-month grace period with the Stafford Loan before your first payment is due. If you haven't obtained a job by then, you can file for an unemployment deferment.
If you are unsuccessful seeking full-time employment (at least 30 hours a week), you can obtain an unemployment deferment for up to 24 months. You must renew your deferment every three months.
Contact your lender or their servicer for more information. You can also choose an income-based repayment plan for your federal student loans and make payments based on your income.
With a SELF Loan you have 12 to 36 months of interest only payments before you must make principal and interest payments. There are no deferments and no grace period in the SELF Loan program. If you can't make payments for any reason, your co-signer must make them for you.
The SELF Loan program does not have deferment opportunities. It is assumed that if you experience difficulty making loan payments, you can ask your co-signer to help.
In the Stafford Program, there are deferment categories for serving in the Armed Services, the Peace Corps (or similar organizations), the National Oceanic and Atmospheric Administration Corps, or a required internship or residency; for doing certain volunteer services; for caring for a sick or disabled spouse or other dependent; and for teaching in a teacher-shortage area. There are also deferments for parental leave and for mothers who are re-entering the workforce. Some of these deferments are available depending on when you borrowed your Stafford Loan. Check with your lender or their servicer for more information.
I have several different student loans, so I'm making more than one payment. Is there a way to merge my loans so I have only one monthly payment?
Yes, if you have more than $7,500 in more than one type of student loan, you might want to investigate loan consolidation. The U.S. Department of Education pays off your various federal student loans, and then makes you one big Stafford-like loan to cover your total debt. The interest rate your consolidating lender can charge is no more than the average interest rate of the loans consolidated, rounded to the next highest 1/8th percent. Loan consolidation can include Stafford Loans, Guaranteed Student Loans (GSLs), Federal Insured Student Loans (FISL), National Direct Student Loans (NDSL) or Perkins Loans, Supplemental Loans for Students (SLS), and Health Professions Student Loans (HPSL). The loan consolidation plans offer more than one repayment option that have the effect of lowering your monthly payment. Loan consolidation plans may be more expensive in the long run, but they do give immediate relief from monthly loan payment burden.
SELF Loans cannot, by law, be included in a federal loan consolidation process.
As a Minnesota resident, your child would be eligible for the state's Interstate Tuition Reciprocity program. This program would allow your child to attend a public institution in Wisconsin, North Dakota, South Dakota, Manitoba or one college in Iowa for a price that is lower than the non-resident tuition price. Your child may also be eligible for a SELF Loan at an out-of-state institution. Students can apply for reciprocity online. Minnesota's State Grant program, however, is not portable to other states.
Also, students can enroll in certain Midwestern institutions at reduced tuition rates through the Midwest Student Exchange Program (MSEP). States participating are Indiana, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota and Wisconsin.