FAP585: The difference between deferment and forbearance, Texas loan troubles, Erin Bode

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FAP585: The difference between deferment and forbearance, Texas loan troubles, Erin Bode

23 July 2007 1 views No Comment

FAP585: The difference between deferment and forbearance, Texas loan troubles, Erin Bode

Student Financial Aid News
+ BankNet360: A consortium of private equity firms and banks has informed Sallie Mae [ticker: SLM”>MP3 file that their buyout bid may be dropped if pending legislative proposals pass. The death of the deal could cost UBS [ticker: UBS”>MP3 file more than $40 million in fees for advising the lender.
+ So far, UBS has received $10 million in fees and was expected to garner more than $50 million once the deal was completed.
+ Chronicle: A cash crunch has hit a popular student-loan program in Texas so hard that thousands of students won’t receive aid that they may have been depending on to enroll for fall classes, which are just weeks away, according to the Associated Press. The interest-free loans are called “B On Time” loans because they were created in order to encourage students to graduate on time, and thereby relieve a shortage of space at state colleges and universities. Students who graduate on time and maintain a B average may have their loans forgiven.
+ But an $8-million cut in the program’s budget this year has made it impossible to finance loans for any new students, as well as for several hundred returning students. The students and their parents are voicing Texas-size displeasure. Financial-aid officers are trying to set up alternative aid packages for the students, although none is likely to be as generous as the “B On Time” program.
+ In the meantime, make sure you’re tapping into federal financial aid such as the Stafford federal student loan and the FAFSA/TAFSA
+ Chronicle: The Senate is scheduled to begin debate today on long-awaited legislation to reauthorize, or renew, the Higher Education Act. Sen. Harry M. Reid, Democrat of Nevada and the Senate majority leader, is expected to propose an amendment that would require many of the largest colleges to use technology designed to prevent students from illegally downloading and swapping music and movie files.
+ The measure, which four powerful higher-education associations and many campus technology experts oppose, is the federal government’s latest attempt at regulating institutions’ day-to-day operations, critics say. The technology to prevent piracy may not even work and could cost universities hundreds of thousands of dollars, they say.
+ Over the past nine months, a group of campus technology leaders has met repeatedly with representatives of the two trade groups trying to protect their copyrights, seeking solutions to the problem of online piracy. At a meeting last October, they concluded that technology used to detect illegal file sharing does not work with many university networks.
+ DUH!
+ Next week is the Bum Rush the Charts tuition scholarship giveaway – make sure you have an account set up on Scholarship Points

Scholarship Update
+ The Bernard Kilgore Memorial Scholarship will be awarded following a statewide competition sponsored by the Garden State Scholastic Press Association and the New Jersey Newspaper Foundation. The scholarship, valued at $5,000, will be awarded by the New Jersey Newspaper Foundation, which administers the Bernard Kilgore Memorial Scholarship Fund. The recipient will be named the New Jersey High School Journalist of the Year and will be entered in a competition for the National High School Journalist of the Year, operated by the Journalism Education Association. Qualifications:
+ Be a graduating high school senior.
+ Be planning to study journalism in college and to pursue a journalism career.
+ Have at least a 3.0 GPA on a 4.0 scale.
+ Have participated in high school journalism for at least two years.
+ Deadline February 15
+ Details at our free college scholarship search

Focus on Financial Aid
+ The difference between deferment and forbearance
+ Forbearance is granted at the discretion of the lender – and they can pretty much do what they want
+ Deferment is mandated by statute – if you qualify, your lender MUST grant it
+ Forbearance keeps the clock running
+ Deferment allows loans that are subsidized to not accrue interest
+ Forbearance is typically allowed for up to 12 months
+ Deferment can be up to 36 months
+ Working on an application to help you determine eligibility for economic hardship deferment – stay tuned
+ In the meantime, check out student loan consolidation

Podsafe Music
+ Don't Take Your Time