1. LAUREN JONES, M.A., NCC VIRGINIA TIDEWATER CONSORTIUM’S EDUCATIONAL OPPORTUNITY CENTER Managing Student Loan Debt

2. Educational Opportunity Center Federally Funded through the U.S. Department of Education All services are FREE ! Educational Counseling Career Counseling & Planning Financial Aid and Scholarship Information & Assistance Satellite Locations: o Every city in Hampton Roads Main Office ~ Norfolk, Military Circle o 861 Glenrock Road, Suite 135 Peninsula Locations: o 6060 Jefferson Ave, Newport News o 600 Butler Farm Road, Hampton Military Base Locations: o Naval Station Norfolk & JEB Little Creek

3. What are Federal Student Loans?  Federal Family Education Loan(FFEL) (As of July 1st 2010, schools no longer participate in the FFEL program)  Direct Loans (William D. Ford)  Funds come direct from the government to student’s account  Subsidized- Federal government pays interest on the loan until repayment  Unsubsidized- Charged interest from the time loan is disbursed  Interest Rates- Reviewed yearly on July 1 st ; percent is set for the year; 8.25% max interest rate  PLUS Loans (parents and graduate students)  Application, credit check, co-signer if required  Available through Direct Loans  Interest Rate- 9% cap

4. Interest Rates  Interest rates on newly originated Direct Subsidized and Unsubsidized loans for undergrad students:  5.6% (09-10), 4.5% (10-11), 3.4% (11-12, 12-13),  3.86% (13-14), 4.66% (14-15)  Interest rates on newly originated Direct Unsubsidized loans for graduate students:  6.21 % (14-15)  Interest rates on for Direct PLUS (parents and graduate) loans:  7.21% (14-15)

5. New Rules to Establish Loan Interest Rates ● Reviewed yearly ● Hinges on the May auction of 10- year Treasury bills (2.61%) ● Interest rate is set on 1 July for the year ● Maximum interest rates  undergraduate 8.25 %  graduate 9.5 %  parent loans 10.5 % Undergraduate loans -- subsidized & unsubsidized  T-bill rate plus 2.05 % Graduate students  T-bill rate plus 3.6 % Parent PLUS  T-bill rate plus 4.6 %

6. Federal Loans vs. Private Loans Federal student loans include many benefits such as fixed interest rates and repayment plans, not typically offered with private loans. You will not have to start repaying your federal student loans until you graduate, leave school, or change your enrollment status to less than half- time. Repayment plans based on your financial situation Do not need a credit check for most federal loans No co-signer Interest may be tax-deductible If you are having trouble repaying your loan, you may be able to temporarily postpone or lower your payments.

7. Repayment Plan Options For Direct and FFEL student loans only:  Standard Repayment Plan  payments are fixed; at least $50 per month; 10 years  Graduated Repayment Plan  Payments are lower at first and then increased every two years; 10 years  Extended Repayment Plan  Payments are fixed or graduated; up to 25 years

8. Con’t Repayment Plan Options  Income based Repayment Plan  Monthly payment is 15% of your discretionary income; your payments change as your income changes; 25 years  Pay as you Earn Repayment Plan  Monthly payment is 10% of your discretionary income; your payments change as your income changes; 20 years  Income Contingent Repayment plan  Payments calculated based on your adjusted gross income, family size, and total amount of your loan; your payments change as your income changes; 25 years  Income-Sensitive Repayment Plan  Monthly payment based on annual income; your payments change as your income changes; 10 years

9. Con’t Repayment Plan Options Set up your payment plan within the 6 month grace period, before your first payment is due. Consolidation Contact your loan servicer if you would like to discuss repayment plan options or change your repayment plan. For more information and comparison charts, please visit: www.studentaid.ed.gov/repay-loans/understand/plans

10. Deferment vs. Default A deferment is a period during which repayment of the principal and interest of your loan is temporarily delayed.  You do not need to make payments  Most deferments are not automatic; submit a request to your loan servicer  Usually up to 3 years To default means you failed to make your payments on your student loan as scheduled.  If you are “NOT” able to make a payment on your loan, contact your servicer immediately  Default occurs when you fail to make a payment for 270 days  Always stay in touch with your lender, loan servicer, or collection agency  You may not attend school using Federal Financial Aid while a loan is in default status

11. Forgiveness Programs Federal loans may be forgiven, canceled or discharged:  Closed School Discharge  Your school closes while you are enrolled or 120 days after you withdrawal  Total and Permanent Disability Discharge  You are totally and permanently disabled  Death Discharge  If you, the barrower, die, your loans with be discharged  False Certification of Student Eligibility or Unauthorized Payment Discharge  Your school falsely certified your eligibility to receive a loan, your school signed your name on the application, loan was falsely certified because you were victim of identify theft

12. Con’t Forgiveness Programs  Unpaid Refund Discharge  you withdrew from school, but the school didn’t pay a refund that it owed to the U.S. Department of Education or to the lender. Only the amount of the unpaid refund will be discharged  Teach Loan Forgiveness  If you are a teacher and also a new borrower, and have been teaching full-time in a low-income elementary or secondary school or educational service agency for five consecutive years, you may be able to have as much as $17,500 of your subsidized or unsubsidized loans forgiven. Your PLUS loans cannot be included.

13. Con’t Forgiveness Programs  Public Service Loan Forgiveness  If you are employed in certain public service jobs and have made 120 payments on your Direct Loans (after Oct. 1, 2007), the remaining balance that you owe may be forgiven  Perkins Loan Cancellation and Discharge  For Federal Perkins Loan Program cancellations, a percentage of the loan may be canceled: Volunteer in the Peace Corps or ACTION program,teacher, member of the U.S. armed forces (serving in area of hostilities), nurse or medical technician, law enforcement or corrections officer, Head Start worker, child or family services worker, professional provider of early intervention services

14. Contact Information www.studentaid.ed.gov www.studentloans.gov US Department of Education: 1-800-433-3243 _______________________________________ Educational Opportunity Center 861 Glenrock Rd. Suite 135 Norfolk, VA 23502 757-683-2312

15. Questions Questions??