Page 77 - Book8E

is 8.5%. PLUS loans are designed for parents who are paying some or all of their undergraduate child’s college expenses. Parents must be creditworthy and may borrow up to the cost of the child’s education that remains after financial aid is deducted.
Repayment of PLUS loans also differs from repayment for Stafford loans. Parents must begin to repay a PLUS loan within 60 days after the student withdraws the loan money. Unlike a Stafford loan, repayment must begin while the student is still enrolled. The parent has up to 10 years to repay the loan with a $50 minimum monthly payment.
It’s Important to Manage Your Student Loan Debt
If you do take out loans to finance your education, it is just as impor- tant to repay them properly as it is any other loan.
Be sure you understand just how much you owe and to whom you owe it. When you are worried about classes and homework, sometimes you may not think about just how much debt you are accruing. Those fed- eral loans can seem pretty easy to qualify for, and if you’re not careful, you will have more debt than you can
handle. Know which financial institu- tions hold your loans. It may only be one or it may be several.
Make your payments on time. Making
your student loan payments on time
will help you establish good credit and
improve your credit rating. It will also decrease the amount of interest you pay. Student loans are just like any other loan—delinquent pay- ments or defaulting on a loan will do damage to your credit worthi- ness. Not only that, if you default on a student loan, it will be turned over to the federal government for collection.
Student Loans and the Cost of a Good Education 67
Poor is the pupil who does not surpass his master.
— Leonardo da Vinci