Cost of Attendance A college's cost of attendance (COA) includes tuition and fees, room and board, books, supplies and equipment, transportation and miscellaneous/personal expenses. Cosigner Release If the primary borrower makes a specified number of consecutive, on-time loan payments and satisfies the lender's credit criteria, some lenders will release the cosigner from his or her obligation to repay the cosigned debt. Repayment behavior is reported on the credit histories of both borrower and cosigner. ![]() The lender may seek repayment from either the borrower or the cosigner, or both. Cosigner A cosigner is a co-borrower, equally obligated to repay the cosigned debt. The consolidation loan pays off the loan balances of the loans that are included in the consolidation. Consolidation Loan consolidation is a form of loan refinance in which multiple loans are combined into a single loan. Collection Costs Collection costs are the costs a lender incurs in trying to collect a defaulted loan. ![]() Colleges with very low cohort default rates can qualify for waivers of certain federal requirements, such as the multiple disbursement rule and the 30-day delay in federal student loan disbursements for first-time borrowers. If the cohort default rate is greater than 40% in any single year or 30% in three consecutive years, the college can lose eligibility for federal student aid. For example, the 3-year cohort default rate is the percentage of borrowers entering repayment one federal fiscal year who default by the second following federal fiscal year. Cohort Default Rate The cohort default rate is the percentage of borrowers entering repayment one federal fiscal year who default by the end of a subsequent federal fiscal year. After the interest is capitalized, interest may be charged on the entire loan balance, including the capitalized interest. Capitalization Accrued but unpaid interest on a loan is capitalized by adding it to the loan balance. Loan discharge and loan forgiveness are two types of loan cancellation. Cancellation Loan cancellation occurs when the obligation to repay a debt is permanently ended. This is a very harsh standard which makes it almost impossible for a borrower's student loans to be discharged. Federal and private student loans are subject to an exception to discharge, which prevents bankruptcy discharge unless repaying the student loans would represent an "undue hardship" on the borrower and the borrower's dependents. The borrower's assets, with some exceptions, may be liquidated and distributed to the borrower's creditors. Bankruptcy Bankruptcy discharge provides borrowers with a clean slate by cancelling all of the borrower's debts. Annual Loan Limit An annual loan limit is the maximum total amount that may be borrowed per year under a loan program. Level amortization is a type of loan amortization in which all of the payments are the same amount. ![]() Amortization Loan amortization spreads the payments on a loan over a series of regular payment periods. Alternative Student Loans See Private Student Loans. Aggregate Loan Limit An aggregate loan limit is the maximum total amount that may be borrowed overall under a loan program. Borrowers who have an adverse credit history are ineligible for a Federal PLUS loan unless the borrower documents errors in the credit report that lead to the adverse credit history determination, the borrower documents extenuating circumstances, or an endorser who does not have an adverse credit history cosigns the loan. Adverse Credit History A borrower has an adverse credit history if the borrower has a current delinquency of 90 or more days on debts totaling more than $2,085, the borrower had more than $2,085 in debt in collections or charged-off in the last two years, or if the borrower had a bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, default determination or a write-off of federal student loan debt in the last five years. Student Loan Glossary Private Student Loans GuruĪPR The APR or Annual Percentage Rate is an annualized interest rate that combines the effects of a loan's fees, compound interest and repayment term, as specified by Reg Z and the Truth in Lending Act (TILA).
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |