Get Your Bearings - Brown University · Get Your Bearings • Your Loans & Servicers – Find your loans – Where & when to repay ... • Unemployed or under-employed • Americorp

Get Your Bearings Brown Financial Literacy

Get Your Bearings

Loan Repayment

Keirsten Connors, Loan Office Manager


Get Your Bearings

• Your Loans & Servicers– Find your loans– Where & when to repay

• Your Options– Repayment Plans– Postpone Repayment– Cancellation & Forgiveness– Consolidation

• Make a Plan– Know your finances– Match loan options to financial goals

• Tips & Resources

Today’s Topics


Get Your Bearings

Find your loans…

• Federal Loans– During exit counseling– StudentAid.gov (MyFederalStudentAid) – NSLDS

• Loans borrowed @ Brown– Banner Self Service

• Private Loans– Credit Report

Your Loans & Servicers


Get Your Bearings

Where to repay…

Stafford & PLUS• Many different federal servicers• Find yours @ StudentAid.gov or during online exit counseling• Will send you account info by mail & email

– Keep your contact info current• Servicers offer online account access • Call them with questions

Your Servicers


Get Your Bearings

StudentAid.gov

Your Servicers


Get Your Bearings

Where to repay…

Perkins & Institutional Loans• Repay to Brown Univ. Loan Office (servicer)• Will send you account info by mail & email• Always give the Loan Office your current contact information• All account questions & forms handled by Loan Office

– Brown Office Building (2nd floor, above Bookstore)– (401) 863-3296 or [email protected]– www.brown.edu/loanoffice

• ECSI is our vendor; they provide online system & mail statements– http://borrower.ecsi.net

Your Loans & Servicers


Get Your Bearings

– www.brown.edu/loanoffice

Your Servicers


Get Your BearingsYour Loans & Servicers

Grace Period

• Begins when you leave school• Payments are not required, but are accepted (no pre‐payment penalty)• Stafford, PLUS, Institutional Loans = 6 months• Perkins loans = 9 months

Repayment Begins

• Loans are repaid to a servicer • Stafford & PLUS = pay federal servicer• Perkins, Institutional = pay Brown Loan Office

Interest Accrual

• Based on the unpaid principal balance• Principal balance and accrued interest are tracked separately• Simple Daily Interest formula• Interest rate / days in year x principal balance = daily interest amount


Get Your BearingsYour Loans & Servicers

Stafford & PLUS

• Unsubsidized & PLUS Loans: Interest began to accrue at disbursement• Subsidized: Interest accrues when repayment begins• Unpaid accrued interest is added to principal one time when repayment begins (capitalization)

• Accrued unpaid interest will be displayed during exit counseling

Perkins & Institutional

• Interest accrues when repayment begins• Any payments made before interest accrues will be fully applied toward principal


Get Your Bearings

• Your Loans & Servicers

• Your Options– Repayment Plans– Postpone Repayment– Cancellation & Forgiveness– Consolidation

• Make a Plan


Today’s Topics


Get Your BearingsRepayment Plans

Perkins & Institutional Loans

• Standard

Stafford & PLUS Loans

• Standard• Graduated• Extended

• Pay As You Earn• Income Based• Income Contingent



• Same amount each month, highest monthly payment• Pro: Accrue/pay least amount of interest• Con: May not be affordable

Standard

• Payments start out small & increase every 2 years• Pro: More affordable at first• Con: Accrue more interest compared to standard

Graduated

• Lengthens repayment from 10 years up to 25 years• Can choose either Standard or Graduated• Pro: Smaller monthly payments• Con: Accrue more interest compared to standard & graduated

Extended



• Payments based on income & require annual documentation• Payments calculated annually• Remaining amounts forgiven after set number of years• Forgiven amounts may be considered taxable income

Similarities

• Maximum payment amount• Maximum length of repayment

Differences

Income Driven Plans(Pay As You Earn, Income Based, Income Contingent)



• Lowest possible monthly payment• Loan forgiveness at the end of the repayment term

Pro

• In repayment for a longer period• Accrue higher amount of interest over time• Forgiven amount can be taxable• Can be difficult to forecast since income changes

Con

Income Driven Plans(Pay As You Earn, Income Based, Income Contingent)



Discretionary income: difference between adjusted gross income and 150% of the poverty guidelines for your family size and state of residence



Compare Repayment Plans during Exit Counseling @ StudentLoans.gov



Repayment Plan Calculators @ FinAid.org


Get Your BearingsPostponing Repayment

Deferment Forbearance

Eligibility Specific situations per promissory note Vary based on loan type (in-school, unemployed, residency)

Financial difficulty

Monthly Payment

Postponed Reduced

Interest Accrues

Only on Unsubsidized Stafford Loans On all loans & must be paid during forbearance

Extends Time to Repay?

Yes No – payments are recalculated when forbearance ends

Automatic? No – Must contact your servicer & submit application paperworkMandatory? No – Can handle each loan separately; request for all, some, or none

View details by loan program @ StudentAid.ed.gov or Brown.edu/loans


Get Your BearingsPostpone Repayment

www.brown.edu/loanoffice


Get Your Bearings

Student loan debt can be discharged (cancelled) under certain specific circumstances & for certain programs:

• Options vary by loan type– View details by loan program @ StudentAid.ed.gov

• Performing qualifying service – Teacher Loan Forgiveness – for Stafford – Public Service Loan Forgiveness – for Stafford, PLUS, or Consolidation– Perkins Loan Cancellation

• For teaching, early intervention services, law enforcement or corrections officer, nurse or medical technician, or child and family service.

• Upon death or total and permanent disability

Forgiveness & Cancellation


Get Your Bearings

If you work in public service, you may be eligible to have your federal loans discharged after 10 yrs.

Eligibility

• Qualifying employment– employed full-time for 10 yrs in public service position

• Qualifying payments– make 120 on-time payments under PAYE, IBR, or ICR

• Eligible loans– Direct Loans (Stafford, Grad/Professional PLUS, Consolidation)

Learn more @ MyFedLoan.org/PSLF

Public Service Loan Forgiveness


Get Your Bearings

• Combine federal loans into 1 NEW loan – Perkins, Stafford, Grad PLUS, LDS

• Fixed Interest rate (weighted avg. of existing loans)• Eligible for income driven repayment plans and/or PSLF• Extends repayment • Apply at StudentLoans.gov

Consolidation

Pros Cons

Combines existing loans into 1 NEW loan with 1 Servicer

Lose borrower benefits on existing loans (Perkins teacher cancellation, etc)

Way to make Perkins eligible for income driven plans or PSLF

Can’t include Private or Institutional Loans

Lower monthly payment Pay more in interest over time


Get Your Bearings

• Your Loans & Servicers

• Your Options

• Make a Plan– Know your finances– Match loan options to financial goals


Today’s Topics


Get Your Bearings

Know Your Finances

How far will my salary go in another city?Cost of living by state@ Money.CNN.com

Know Your Finances


Get Your Bearings

Know Your Finances

Know Your Finances

• Budget helps track your income & expenses• Estimate income, deductions & take home pay @ StudentLoans.gov or

SurePayroll.com• Cost of living by state@ Money.CNN.com


Get Your BearingsMatch Options & Goals

Match your loan options to your financial goals

Financial Goal:• Pay Off Debt Quickly/Pay Least Interest

Loan Options:• Choose Standard repayment plan• Pre-payment: make payments when they aren’t required (in-school,

grace, deferment)• Avoid interest capitalization, pay accrued interest on Unsubsidized &

PLUS during grace• Pay extra each month• Pay off high interest loans first



Financial Goal:• Lowest Monthly Payment

Loan Options:• Consolidate to combine Stafford & Perkins

• Allows you to repay Perkins amount using income-driven plan• Choose an Income-driven repayment plan (PAYE, IBR, ICR)

• Apply online at StudentLoans.gov• Notify your federal servicer• Submit income documentation each year

• Review Deferment or Forbearance options (vary by loan type)• Institutional or private loans (not eligible for federal consolidation or

federal repayment plans)



Financial Goal:• Postpone Repayment

Loan Options:• Deferment & forbearance options vary by loan type• Return to school (must be at least ½ time enrollment)

• Unlimited in-school deferment• If original grace period is fully used, repayment will begin

immediately after enrollment ends• Unemployed or under-employed• Americorp – has own process online



Financial Goal:• Receive Public Service Loan Forgiveness

Loan Options:• Consolidate now• Choose income-driven repayment plans• Do not make extra or early payments• Notify your servicer• Visit MyFedLoan & begin tracking qualifying payments &

employment• Institutional or private loans aren’t eligible


Get Your Bearings

• Understand Your Loans

• Understand Your Options

• Make a Plan


Today’s Topics


Get Your Bearings

Having Trouble Making Payments?• Consolidation can lower monthly payments • Switch repayment plan• Review deferment / forbearance options• Contact your servicer(s) for guidance!

– Loan Office: [email protected] or (401) 863-3296

What’s the big deal?• Loan status reported to credit bureaus every month• Building credit history – for better or worse• Annualcreditreport.com• Consequences of default

– Late fees– Hold on diploma & transcripts– Turned over to collection agency

Tips & Resources


Get Your Bearings

Mandatory Loan Exit Counseling

• Must complete online between April 15th – May 4th

• Incomplete = hold on diploma

• More than one requirement!– Perkins & Institutional: http://borrower.ecsi.net– Stafford & Grad/Med PLUS: http://studentloans.gov

Tips & Resources


Get Your Bearings

To Do List• Complete exit counseling (April 15th – May 4th)

• Pay attention to the estimated repayment amounts for each plan

• Set up online account access with your servicers• Update your address, email, & phone• Select a repayment plan

• Complete applications to postpone repayment if needed• Must apply with each servicer separately• Submit residency deferment and forbearance paperwork• Mark calendar to submit again in 11 months

Tips & Resources


Get Your Bearings

Servicer ContactsBrown Univ. Loan Office: [email protected] or 401-863-3296Locate federal servicers: www.nslds.ed.gov & www.studentaid.ed.gov

Loan DetailsExit Counseling: http://borrower.ecsi.net & www.studentloans.govLoan basics & DL repayment plans: www.studentaid.ed.gov & Brown.edu/loanofficePublic Service Loan Forgiveness: http://www.myFedLoan.org/PSLFConsolidation: www.studentloans.gov

CalculatorsRepayment Estimator: https://studentloans.gov/myDirectLoan/mobile/repayment/repaymentEstimator.actionRepayment plan calculators: StudentAid.ed.gov or FinAid.orgInterest Capitalization Calculator: http://www.finaid.org/calculators/interestcap.phtmlPre-payment calculator: http://www.finaid.org/calculators/prepayment.phtml

Tips & Resources


Get Your Bearings

Personal finance topicsCNN Money 101MyFico.com

Income & ExpensesEstimate payroll deductions: www.surepayroll.com/calculator/calc_paycheck_netpay.aspCost of living by state: http://money.cnn.com/calculator/pf/cost-of-living/

Credit RelatedFree copy of credit report: www.annualcreditreport.comCredit score: www.myfico.com

Budgeting Resources – Apps, Calculators & Worksheets www.xpenser.com (mobile)www.mint.com (mobile)http://www.cnbc.com/id/25933653/ YouCanDealWithIt.com MappingYourFuture.orgMoneyUnder30

Tips & Resources


Get Your Bearings

QuestionsLoan [email protected] or (401) 863‐3296

Documents

Get Your Bearings - Brown University · Get Your Bearings • Your Loans & Servicers – Find your loans – Where & when to repay ... • Unemployed or under-employed • Americorp