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Digital News Report – It may get more difficult to get a student loan, according to one report, at least “temporarily”. There has been a surge in some student applications. The number of people applying for specialties like obstetrics and gynecology has skyrocketed.
There is a high demand for graduate student loans right now. The demand has never been higher despite the economic turmoil. Getting loans has got tougher because banks and other lenders have become more discriminating. They worry that their debts will not be repaid. Experts recommend cleaning up your credit score before graduate school.
Perkins Student Loan Program
After filing for financial aid, students may ask their school’s financial aid department if they qualify for a Perkins Loan. The loans, up to $8,000, charge no interest while in school and only 5% after graduation. They are also eligible for Federal Loan Cancellation for teachers in low-income schools. The loans can be forgiven.
Undergraduates are eligible for $5,500 per year with a lifetime maximum loan of $27,500. Graduate students can get up to $8,000 per year with a lifetime limit of $60,000. This includes undergraduate loans.
The report also recommends Stafford Loans.
Student Loan Programs
Ex-President Bill Clinton said that the changes in the student loan program will boost charities and aid programs. Graduates will be more likely to work with aid groups, he said.
President Barack Obama recently signed a law that cut the private banks out of the student loan business. The changes will also cap the graduate repayment at 10 percent of the income.
The program has been expanded and has become more attractive for students. After 2014 students will be able to get forgiveness after 20 years instead of 25.
Pell Grants
The money allotted for Pell Grants will rise with inflation. Right now the grants top-out at $5,350.
Last year 6 million people benefited from the program. These grants do not have to be paid back.
By: Tina Brown
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