Tips To Help You Apply For A Federal Student Loan

1) Apply online using www.fafsa.ed.gov.

2) Check deadlines. Be aware of your state's and your school's application deadlines. While there is no deadline for applying for federal student aid, you should apply as early as possible after January 1 of each year that you will attend college. Some state and school aid is awarded on a first-come, first-served basis.

3) Collect the information you need to complete the FAFSA:
* Your Social Security number and your parents' Social Security numbers;
* Your driver's license number, if you have one;
* Your alien registration number, if you are not a U.S. citizen; and
* Your federal tax returns and income information

4) Check your FAFSA. After you complete the FAFSA, you will receive a Student Aid Report (SAR). Review the information carefully and make any necessary corrections.

5) Respond immediately to any request from your school for additional information.

(Source: federalstudentaid.ed.gov)

FFEL and Direct Loan Interest Rates Effective July 1, 2009

Fixed Rates for Loans First Disbursed on or After July 1, 2006

Subsidized Undergraduate Loan: First Disbursed 7/1/2008 to 6/30/2009: 6.00%
Subsidized Undergraduate Loan: First Disbursed 7/1/2009 to 6/30/2010: 5.60%

Subsidized Graduate Loan: 6.80%

Unsubsidized Undergraduate Loan: 6.80%

Unsubsidized Graduate Loan: 6.80%

Direct PLUS Parent Loan: 7.90%
Direct PLUS Graduate Student Loan: 7.90%

FFEL PLUS Parent Loan: 8.50%
FFEL PLUS Graduate Student Loan: 8.50%


Variable Rates for Loans First Disbursed Between July 1, 1998 and June 30, 2006

These rates were calculated based upon statutory formulas and equal the bond equivalent rate of the 91-day Treasury bills auctioned on May 26, 2009, plus certain statutory percentage add-ons. The 91-day Treasury bills were auctioned at 0.178 percent, rounded to 0.18 percent.

Subsidized (Repayment/Forbearance): First Disbursed 7/1/08 to 6/30/09: 4.21%
Subsidized (Repayment/Forbearance): First Disbursed 7/1/09 to 6/30/10: 2.48%

Subsidized (In-school/Grace/Deferment): First Disbursed 7/1/08 to 6/30/09: 3.61%
Subsidized (In-school/Grace/Deferment): First Disbursed 7/1/09 to 6/30/10: 1.88%

Unsubsidized (Repayment/Forbearance): First Disbursed 7/1/08 to 6/30/09: 4.21%
Unsubsidized (Repayment/Forbearance): First Disbursed 7/1/09 to 6/30/10: 2.48%

Unsubsidized (In-school/Grace/Deferment): First Disbursed 7/1/08 to 6/30/09: 3.61%
Unsubsidized (In-school/Grace/Deferment): First Disbursed 7/1/09 to 6/30/10: 1.88%

PLUS Parent Loan: First Disbursed 7/1/08 to 6/30/09: 5.01%
PLUS Graduate Student Loan: First Disbursed 7/1/09 to 6/30/10: 3.28%


Notes:

*Interest rates on Stafford and PLUS loans disbursed before July 1, 1998, are calculated using different statutory formulas, percentage add-ons, or both.
*Generally, interest rates on Consolidation Loans are fixed rates calculated based on the weighted average of the loans being consolidated rounded up to the next higher 1/8 percent, not to exceed 8.25 percent.

(Source: studentaid.ed.gov)

Prioritizing your Debt

I saw a good foundational article today at MSNBC on their Today page.

If you have several different types of debt — say, a credit card balance on a card with a 17% interest rate, a car loan with a 12% rate, and a student loan at 9% — pay off the loan with the highest interest rate first. One strategy you may want to consider is stretching out your student loan payments over 15 years instead of 10 years by signing up for the Federal Direct Consolidation Loan program. (To see if you're eligible, call the Department of Education at 800-4FED-AID.) This will reduce your monthly student loan payment and leave you with extra cash. Use this money to pay off your credit card balance faster. Once you've gotten rid of your credit card debt, start paying off your auto loan faster. After you wipe out that loan, too, increase your student loan payments to at least their initial levels.

If you're looking at a lot of different types of debt, it's important to stay disciplined to these principals.