Student Loans

How much student loan debt you should be willing to incur to pay for college?

• No more than 1 year of your parents' annual salary

• No more than half the amount of the school tuition

• No more than the starting salary in your anticipated career

Which of the following statements is TRUE?

• the longer the term, the more total interest you pay

• the longer the term, the quicker you will pay off your loan

• the longer the term, the lower the total cost of your loan will be

• the longer the term, the more damaged your credit score will be

Which of the following statements is TRUE?

• Private student loans will build a student’s credit while federal students loan will not

• Private student loans typically have more flexible repayment plans than federal loans

• Private student loans are best for students who have already received all possible federal loans but still have a funding gap

• Private student loans are almost always taken out by parents because the federal government doesn’t offer loans to parents

If you do not contact your loan servicer to select another option, your Federal student loans will default to standard repayment, which has a term of

• 1 year

• 5 years

• 10 years

• 25 years

Which of the following is correct?

• On subsidized loans, you never pay any interest; you pay interest on unsubsidized loans.

• On subsidized loans, the government pays the interest while you're in college, and then you pay the interest once you're no longer enrolled.

• With subsidized loans, if you don't graduate and earn a diploma, you don't have to pay those loans back. All unsubsidized loans must be repaid.

• Subsidized loans come from private banks, while unsubsidized loans come from the Federal government.

Which statement offers the BEST advice on dealing with your student loans once you’re out of school?

• Your student loan servicer will automatically contact you once your grace period is over. Until they contact you, you don't need to worry about your loan repayment.

• Making sure you pay your loan is the responsibility of your loan servicer. If they do not ask you to pay back the money you don’t need to worry about it at all.

• Most student loans have a 6 month grace period before payments start. This means that you can start paying right away to reduce your total interest payments or wait for up to 6 months after you graduate.

• Most student loans have a 6 month grace period before payments start. This means that you cannot start paying right away but must start paying once the grace period is over.

Bonnie is trying to decide between standard repayment and income-based repayment for her $30,000 student loans. Her job pays $29,500 per year. Which of the following statements is likely TRUE?

• Bonnie will likely pay less, total, if she goes with the standard repayment.

• It's best for Bonnie to choose standard repayment, even if that means she's delinquent on some of her monthly payments.

• Bonnie's monthly payments on the income-based plan will likely be lower than on the standard repayment plan.

• Bonnie makes too much money to qualify for income-based repayment.

Which of the following options will likely be MOST expensive?

• Private loan

• Grant

• Unsubsidized federal student loan

• Subsidized federal student loan

What is one benefit of consolidating Federal student loans?

• Interest-free deferment

• Loan cancellation

• Having only one bill to pay each month

• Being able to add to your student loans, even though you are no longer a student

Susie is considering a graduated repayment plan, which means ________

• Her monthly payments will start lower and end higher.

• She won't be charged any interest until she successfully graduates.

• Her payments will fluctuate with how much money she's earning every month.

• She will receive loan credits based on how high her GPA is when she graduates.