Thursday, September 11, 2008

College Student Loans - Your Own College Can Help Your Finances

The source of funds for a college loan does not alter the expectations of the student who is awarded that loan. Every lender of a college student loan has certain obligations.

What to Expect from the Lender of a College Student Loan

Every lender of such a loan needs to supply the borrower with certain information. For example, anyone who receives one of the college student loans should receive a detailed repayment schedule.

Yet a borrower looks for more than just a repayment schedule. A borrower needs to know the loan rates and the loan fees. A person who is awarded one of the college student loans should also be provided with information about the balance owing on the loan and the payment options.

Once the borrower has paid the loan in full, then he or she should get written confirmation of that fact.

Rights of Students Awarded One of the College Student Loans

A student who struggles to make payments on a student loan has a right to defer payments for a defined period. A student who feels unable to fully repay a loan might qualify for forbearance on that loan. College student loans give qualified students the right to request such forbearance.

A student provided with money through a college student loan should look into the possibility of getting a graduated payment schedule. An income-based payment schedule might also be an option. Some private lenders of college student loans (and all sources of government loans) allow for early repayment of that loan, without charging a prepayment penalty.

Obligations of Students Receiving One of the College Student Loans

While any student can request deferment on a loan, or forbearance on a loan, the student making that request cannot assume that it is granted. The student must continue making payments on his or her college loan. Moreover, the student must keep the lender informed of any changes to his or her vital information.

Suppose, for example, that someone getting one of the college student loans changes his or her address. The lender must then be provided with the new address. Suppose a student awarded a college loan changes his or her job. The lender must be given the name and address of the new employer.

A name change for a loan recipient should not be hidden from the eyes of a loan lender. By the same token, a student awarded one of the college student loans needs to keep the lender apprised of any change in his or her phone number or Social Security number.

A student can maintain a respectable credit score if he or she fulfills all the above-mentioned obligations. Such a student has clearly shown a willingness to act “in good faith” towards the lender of the loan money.

By Martin Haworth

Check Out the Related Article : An Overview of Student Loan Debt Consolidation

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