If you need financial assistance for your college education, it may be in your best interest to apply for a Federal loan. Generally, these loans are more forgiving and don’t require pristine credit. This makes them perfect for students who do not yet have an established credit history, or for those who may have a poor credit record. Here are some tips to help making applying for a Federal loan a lot easier.
The most commonly used Federal loan is called an FSA which is short for Federal Student Aid.This is what is known as a direct loan. You will be applying directly to the US government for your loan and you will be required to pay them back. These loans are offered through the Department of Education.
Before you apply, you will need to check to see if your school participates in the Direct Loan program with the government. If they do not, you will need to find a different kind of loan. However, if they do, you can proceed to the next step. FSA loans now offer an online application process which makes it a lot easier to complete the forms and eliminates a lot of the waiting period.
After you file your application, you will need to sign a promissory note. This is a note that basically says that you agree to pay back the Federal government for the amount that they have agreed to lend you. These notes are very serious and should not be taken lightly. You can have your wages or your tax return garnished if you fail to repay the government. In some cases, you may even be sued if you fail to make payment.
When it comes to repaying the loan, there are several available options. If you are low income, you may be able to get it broken down into very small payments. Most repayment schedules will be based on your annual income. You will need to start repaying these loans as soon as you are out of school. In some cases, you may be able to work out a deal with the Department of Education to extend this time period or offer a graduated scale for repayment of the loan.
When you apply for your FSA, it is vital to be completely honest in your application. You do not want to mislead the Federal government, serious repercussions can occur.
