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Important Things to Know About Student Loans
Q: How do I know how much I should be able to borrow?
A: Given a student's expected future annual salary
and total loan debt upon graduation, the "how much to borrow calculator" on the finaid.org website is helpful in determining how much to borrow.
Q: How can I estimate monthly student loan payments based on various interest rates and loan amounts? Is there a good calculator?
A: A loan
repayment calculator is available on the finaid.org website.
Q: How do I know whether I'll be able to afford student loan payments in the future?
A: Student loan borrowers need to have a realistic projection of anticipated estimated salary and future potential earnings; starting
salaries for Purdue graduates are available a website
provided by the Purdue Center for Career Opportunities.
Q: What information is available specifically for Stafford loan borrowers?
A: Stafford loan borrowers should review information at www.purdue.edu/dfa/staffordrepayment.htm.
Q: What is entrance loan counseling?
A: Students who borrow educational loans at Purdue are
encouraged to complete entrance
loan counseling.
Q: What is exit loan counseling?
A: Students are encouraged to receive exit
loan counseling before graduating or otherwise leaving
school. In addition, the
University Collections Office is required to conduct exit
loan counseling for Perkins, Purdue, and Health Profession
Loan borrowers.
Q: What are consolidation loans?
A: Consolidation Loans
are designed to help student and parent borrowers simplify
loan repayment by allowing the borrower to combine several
types of federal student loans with various repayment schedules
into one loan, and/or to extend the repayment period length.
Q: Since private loans require established credit, what tips are available to maintain/establish a good credit record?
A: It is essential to understand credit reporting and credit scoring. As well, being creditwise also requires practicing good habits. Please see this article, Becoming Credit-Wise: What Students (and You!) Should Know, for tips and more information.
Q: Are there any special loan deferment positions for members of the military?
A: Yes, the College Cost Reduction and Access Act (CCRAA) made several welcomed changes to the military service deferment created by Higher Education Reconciliation Act of 2005 (HERA); see this NASFAA article for more information.
Q: Is there any public service loan forgiveness?
A: Yes, the recently enacted College Cost Reduction and Access Act (CCRAA) creates a new loan forgiveness option for Direct Loan borrowers who hold public service jobs. FFEL borrowers may take advantage of public service loan forgiveness by consolidating or reconsolidating their FFEL loans into the Direct Loan program; see this NASFAA article for more information.
Q: How do I know if a private loan is a good deal?
A: Students and families should beware of high interest loan products and deceptive marketing tactics. It is almost always in the best interest of students to explore federal student loan options before applying for private loan products. Purdue students are encouraged to research private student loan options at www.finaid.org/loans/privatestudentloans.phtml.
Q: What type of assistance is available once I start repayment?
A: Your lender or loan services can answer almost all loan repayment questions; another independent resource to help borrowers is the federal Student Loan Borrower Assistance web site.
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