Student Loans In California & Texas

If you’re struggling under mounting student loan debt, you’re not alone.  Right now there are approximately 40 million student loans totaling over $1 Trillion.  Today the average student loan borrower leaves college with $25,000 in student loan debt; it is not uncommon for some new graduates to have over $100,000 in student loan debt. This year, for the first time in history, total outstanding student loan debt is now higher than total credit card debt.  According to industry estimates 11.2% of student loans are in default.  With the economy in the tank and jobs scarce, it’s no wonder student loan borrowers are frustrated.

Because most student loans do not require payment while the student is in school, it’s easy to accumulate debt and not understand the impact of a mounting debt.  This combined with a lack of financial literacy, compound interest and dismal job prospects can devastate a student’s financial outlook. For these reasons we’ve dedicated a significant resources to assist students and prospective clients in resolving their outstanding student loan debt.

There are basically two types of student loans; Federal and Private.  Both types of loans may only be used for educational related expenses.  These expenses include tuition, housing, food and books.  Generally speaking, to qualify for student loans you must be enrolled full time at an accredited or approved university, college or trade school.

The primary differences between Federal and Private student loans are Federal Student Loans are made directly by and guaranteed by the Federal Government, Private Student Loans are made directly from private lenders such as banks and credit unions and may or may not be guaranteed by the government.

The other difference between the two is Federal Student Loans are granted (to some degree) based on need.  Private Student Loans are based solely on your creditworthiness and ability to pay.

Below are more details related to the most common types of Federal Student Loans:

Federal Student Loans

Perkins Loan– A Federal Perkins loan is a low interest (generally around 5%) loan for undergraduate and graduate students with “exceptional” financial need.  Perkins Loans are awarded by the individual schools and are guaranteed by the Federal Government. Perkins Loans have limits as to how much can be borrowed and are granted primarily to freshman and sophomore students.  To qualify for a Perkins student loan, you must be a U.S. citizen, permanent resident or eligible non-citizen enrolled in an eligible school at least half time.  You must have satisfactory academic progress, no unresolved default on educational loans and satisfy all Selective Service requirements.

Stafford Loan– A Stafford loan is presently the most common type of student loan.  Stafford Loans are awarded based on financial need.  To qualify for a Perkins student loan, you must be a U.S. citizen, permanent resident or eligible non-citizen enrolled in an eligible school at least half time.  You must have satisfactory academic progress, no unresolved default on educational loans and satisfy all Selective Service requirements.  Stafford Loans have limits.  There are two basic types of Stafford Loans; subsidized and unsubsidized.  The primary difference between the two loans is; a subsidized loan, interest does not begin to accrue until after graduation.  For unsubsidized loans, interest begins at the time of distribution.

PLUS Loan– Are federally insured and obtained by parents of students as well as being made directly to graduate students.  PLUS Loans essentially have no limits and allow borrowers to borrow the total amount of educational expenses, including college including tuition, housing, food and books.  PLUS Loans are granted based on creditworthiness and ability to pay.  You must have good credit and demonstrate an ability to repay the loan.