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Choosing to Understand:

Student Loans

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How are you paying for college?

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Student Loan Debt Nationwide

Source: Source: American Council on Education Issue Brief, November 2001

Average student loan debt nationwide for undergraduates is $15,375.

Average student loan debt nationwide for graduates is $32,716 (includes undergraduate debt).

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Repayment Options

Standard Repayment Graduated Payments Income Sensitive Extended Repayment Loan Consolidation

Source:Source: U.S. Department of Education (www.ed.gov)

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Interest on My Student Loan

AA “subsidized”“subsidized” student loan: the student loan: the federal government will pay the federal government will pay the interest on your loan while you are in interest on your loan while you are in school.school.

AnAn “unsubsidized”“unsubsidized” loan: you are loan: you are responsible for paying interest that responsible for paying interest that begins accruing when you receive the begins accruing when you receive the loan.loan.

Source: Source: U.S. Department of Education (wwww.ed.gov)

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Estimated Repayment for Federal Direct Subsidized

Loan

*Minimum monthly paymentSource: Source: Dear Student Letter, OSFA

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Undergraduate Repayment

Source: Source: Dear Student Letter, OSFA

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Graduate Repayment

Source: Source: Dear Student Letter, OSFA

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Salary Requirements

Minimum Gross Annual Income Needed to Meet 8% Rule*

Source: Source: Dear Student Letter, OSFA

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Median Incomes Nationally

for Bachelor Degree

Source: Source: College Placement Council Annual Salary Survey, July 1999

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Examples of Default Rates for Georgia Schools Cohort FY 00

Medical College of Georgia 0.2%

Emory University 1.3%Georgia Institute of Technology 1.5%Berry College

2.6%Morehouse School of Medicine 2.9%University of Georgia

2.9%Kennesaw State University

3.6%Atlanta School of Massage

3.8%National 5.6%Ultrasound Diagnostic School

6.3%University of Georgia

6.4%Empire Beauty School

12.1%

Source: Georgia Student Finance Commission (www.gsfc.org)Source: Georgia Student Finance Commission (www.gsfc.org)

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Delinquent vs Default

Delinquent: failure to repay your loan on time in accordance with the terms of your promissory note. Delinquency begins on the day following your loan payment due date.

Default: failure to repay as agreed and the failure has continued for 270 days.

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If you don’t repay your loan on time...

You’ll grow to hate going to your

mailbox.

You could have your automobile impounded..

You’ll be leery about answering your

telephone.

You could lose a professional license issued

by the state.

You could forfeit a state or federal income tax refund.

Your employer could find out.

Your pay could be garnished.

You could be sued.

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The Main Points

Student loan debt adds up quicklyHave realistic expectations of your

starting salary so you can estimate how much student loan debt you can afford

Not paying back student loans can have major consequences

Student Loans are NOT free moneyOnly ask for what you NEED

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For Individual Help Contact:

Consumer Credit Counseling Service

https://onlinecounsel.cccsatl.org/gheac.asp

866-829-3438

(referral #017)