Important Free Application for Federal Student Aid Information

3GM February 27, 2012 0

Each year around this time, most college students and their parents wait for W2 forms to come in the mail so they can file their taxes and the FAFSA (Free Application for Federal Student Aid http://www.fafsa.ed.gov/).

Last year, Kentucky, along with other states, ran out of funds for state-based grants. Several students who had previously been awarded those grants lost them if they didn’t file their FAFSAs super-early. This year, many institutions and several states are encouraging students to file as soon as possible after January 1st.

Go here http://www.fafsa.ed.gov/ to fill out your FAFSA and see deadlines for your state.

We have some good news for all of our college students with FFEL (Stafford, Unsubsidized Stafford, PLUS, and Consolidation) loans! President Obama announced a Special Direct Consolidation Loan available to some borrowers with federal loans. This loan is not your same old Direct Consolidation Loan, and is only available for a short time period. This is a great opportunity for borrowers with the old, FFEL loans because it makes managing repayment so much easier.

This Special Direct Consolidation opportunity will allow borrowers who have both Direct Loans and FFEL to consolidate their FFEL loans into a Direct loan, allowing all loans to be serviced by the same company.

Benefits

  • One loan servicer, one payment
    Public Service Loan Forgiveness eligibility
    0.25% interest rate reduction (another 0.25% reduction if you choose auto-debit)
    Change from Variable to Fixed rate

To be eligible borrowers must have both an FFEL and a Direct Loan. But, only the FFEL loans are eligbile. And your loans have to  be in good standing (not in default or bankruptcy) and in either grace, repayment, deferment, or forbearance.

Borrowers who are eligible to consolidate under this loan will be contacted by their current Direct Loan Servicer with instructions. Notifications of eligibility began January 17, 2012. This option will only be available until June 30, 2012, so make sure to take action as soon as you hear from your servicer if you plan to participate.

For more info check out Student Loan Network

Now stop reading and go file your FAFSA!

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