Many college students today hit a hurdle before they even start when it comes to finding the funds necessary for college because they have already managed to run up a poor credit history. Fortunately however there are aid and loan packages available today which look principally at need and ignore your credit history and so this is where you will need to start your search for funding.
One of the oldest sources of funding and one which is chiefly available on the basis of economic need is the Pell grant. As long as the student and his family are considered to be a low-income family a Pell grant is more or less automatic and is made on the basis of the submission of supporting documentation.
The student will be required to provide proof of the cost of his intended course (including tuition fees and other qualifying costs) and will also need to provide details of the family’s income from which an EFC (Expected Family Contribution) number will be calculated. On this basis a decision will be made and the grant made or refused.
As the name suggests, a Pell grant is a ‘gift’ and not a loan and it does not have to […]
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Established by an Act of Congress in 1965 and begun in 1966, the Federal Family Education Loan Program (FFELP) is a partnership program between the federal government and private lenders and an umbrella program which includes Stafford loans, student PLUS loans and Perkins loans. Since it started more than half a trillion dollars have been disbursed through this program.
Funds for the program are provided by a network of independent banks, credit unions and other financial institutions and lenders are generally happy to make money available in what would normally be considered a high risk area of lending because loans are to a large degree (although not totally) underwritten by the federal government. In about five percent of cases private guarantors do become involved with defaulted loans and are able to make application to the federal government for at least partial reimbursement.
The vast majority of funds are used for subsidized and unsubsidized Stafford loans. In the case of subsidized loans the federal government pays the interest on loans while students are attending full-time courses (and for up to six months after graduation), while in the case of unsubsidized loans students are responsible for paying the interest due on their loans. Interest […]
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