Archive for the ‘Loans’ Category

Budgeting: Paying Down Your Student Loans Successfully While Still in School

Even before taking out student loans, you should come up with a plan for repayment. Figure out how much you are borrowing, how much you will be earning, and what your best option is. This is where budgeting comes in handy.

The average student loan debt is rising, as is the number of student loans that are going unpaid and falling into default. More people with student loans are finding it harder to make their payments on time, if at all, and are falling behind. That being said, it’s pretty important that those who aren’t already in that boat prepare adequately for their upcoming task of paying back what they borrow, and those who are already falling behind find a way to fix their situation.

Follow these tips to stay on-track with your student loans.

  1. Determine how much you are borrowing, and what the grace period is. Each loan may have a different grace period, so make sure you read the terms of each carefully. Keep track of your loans, and always be aware of the terms and conditions.
  2. Figure out how much you will be making in income. If you have a part time job, are participating in work study, or even run your own small business, figure out some average numbers. Know how much are you bringing in per month after taxes.
  3. Figure out a payment plan. Once you know how much you are bringing in, take a close look at how much is going out. Do you have enough left over to pay your loan payment each month? If not, where can you cut back on your spending to give yourself some money to pay off your loans? Sometimes with work study, you can find ways to put it all towards your loans. This is a great way to keep your interest from building while you are in school and get a head start on your repayment.
  4. Do the math. Use the smallest numbers available so you’ll always be pleasantly surprised, rather than have to scramble to scrape up some more cash. What I mean by that is calculate your lowest possible paycheck. Say you are sick a few days, or don’t get scheduled for as many hours as usual… plan your budget around those numbers. That way, you can always pay off more, but you’ll never be short.
  5. Stay on top of it! If you can get a good foundation going while you are still in school, repayment after graduation will be a breeze! If you are already well accustomed to paying a certain amount every month, then continuing to do so won’t be a problem at all!
  6. If for some reason your circumstances change, talk to your loan provider about your options. They offer forbearance and deferment plans to buy you some time to get things in order. Either one is a vastly more preferable option that going into default, which can affect your credit score and impede your ability to take out loans in the future if you need to.

Once you are out of school and have a stable job, look into refinancing and consolidating your existing student loans.  This is a good way to roll everything into one payment and potentially get a lower interest rate.  Check out the student loan refinance offers from major lenders using our student loan consolidation finder.

I neglected to do this with my own student loans, and to this day I’m kicking myself over it! I was only nannying a few days a week after classes, but even with just that money (which I didn’t need to cover any of my bills or other costs) could have paid off nearly $4,000 in the time I worked that job! That would have been a nice weight off my shoulders once the time came for me to begin repayment!

Top five features to look for in an apartment

Apartments tick plenty of boxes. In any given location they tend to be more affordable than houses, they typically involve less maintenance, and amid a growing preference for lifestyle over the traditional quarter acre block, apartments are dishing up healthy rental yields which is good news for investors. As a guide, the latest industry figures from CoreLogic show rental yields on apartments across Australia’s eight capital cities are currently 4.3% compared to 3.4% among houses1.

So far, so good. However with a wide variety of apartments to choose from it is important to select an apartment that ticks all the boxes – strong tenant appeal, the potential for capital growth, and low ongoing costs. We narrow down five key features to look for in apartment to enjoy healthy long term returns.

1. Scarcity

Scarcity usually underpins property values, and buying in a mutli-storey high rise complex where each apartment is pretty much the same, can limit long term price appreciation.

Budget permitting, aim for a low rise boutique development with a small number of apartments. These types of developments offer a sense of exclusivity that will appeal to tenants – and give you an edge at sale time.

2. An appealing location

Tenants often choose apartments because of the convenient lifestyle they provide, and a unit located within walking distance to schools, shops, cafes and restaurants is more appealing than a building in a less central location.

Choose a unit in a street away from main roads, preferably where there is a high proportion of houses rather than row upon row of apartment blocks. Where possible, aim for a north-facing property with lots of natural light.

3. Off-street parking

A tenant’s car is often one of their most valuable assets and the availability of off-street parking can be a deal clincher. Undercover locked car spaces are especially valuable as they double as extra storage space.

4. Kerb appeal

We’ve all seen those tatty unit blocks where garbage bins line the entranceway and junk mail is piled high in the doorway. It’s not a good look, and a lack of street appeal can make it difficult to attract tenants as well as affect the value of the property at sale time. A poorly maintained exterior also raises questions about whether the body corporate is taking a pro-active approach to building maintenance.

Look for apartments with well-maintained gardens or outdoor areas. Not only does this provide kerb appeal, it can also indicate a high number of owner occupiers who may be more likely to take good care of the property. Do check if superior maintenance means paying higher strata fees, though the additional cost may be offset by improved long term capital growth and lower vacancy rates.

5. A clean bill of health

Just as it pays to organise a pre-purchase pest and building inspection of a house, anyone investing in an apartment needs to think about arranging a strata report.

A strata report involves an inspection of the strata records and accounts maintained by the building’s owners’ corporation. The report may show evidence of unresolved legal issues, disputes between owners and pending building works – an expense that you, as a new owner, may be asked to contribute towards.

Have you recently bought an apartment? What were the features that sold it to you?

The Lies They Tell In a Student Loan Relief Scam Business

Want to start a student loan relief business? According to a recent ad that will give you all the tools to do just that, you can learn the tricks that let you cut someone’s private student loan payment by more than 50%.

Clients who sign up for this program apparently also get a written guarantee and credit restoration included.

It sounds like a good result to offer to people who need help with their student loans.

And with so many people falling behind on their student loans, it sounds like it’s extremely profitable for the business owner.

But remember that if something sounds too good to be true then it probably is. So, too, with these student loan relief businesses that are popping up all over.

In fact, it’s scams like these that have led Attorneys General in Illinois and Washington State, as well as the CFPB, to take drastic action.

Lower Your Private Student Loan Payments!

The first problem is the promise that the company’s program can reduce private student loan payments by more than half.

The only way a borrower can get a payment that much lower than the contractual payment is if they’ve already defaulted. In many cases, these super-low payments are available only if you’re being sued and actively defend your case.

In other words, payments this low are usually part of a settlement deal that comes only after you’ve gone significantly past due on your private student loan and have wrecked your credit.

Just as in credit card settlements, no private student loan creditor would modify loan payments down to 50% or less if you’re making on-time payments.

Deal With Your Federal Student Loans!

Federal student loans don’t offer massive settlement options, and the scammers know it. So for these loans they offer a one-size-fits-all approach.

Every federal student loan gets consolidated and the borrower gets put into Income-Based Repayment.

For some people, that’s the right choice. But not for everyone.

Consolidation isn’t the only option. And for some federal student loan borrowers, it’s not an option at all.

For the student loan companies that have cropped up overnight as the mortgage mess has been replaced by the student loan problem, profitability means doing the cheapest and quickest job without regard for whether it’s the right one.

It’s A Sure-Fire Way For You To Lose Your Money

The ad that teaches how to operate one of these businesses theoretically offered access to attorneys to help with compliance reviews.

Good thing, if that’s true. Because anyone who wants to become a student loan scammer is going to need all the legal help they can get.

Most states have debt settlement or modification laws and complex licensing requirements.

These companies that advertise credit repair also need to comply with the Credit Repair Organization Act.

I’d be shocked if these companies are doing anything more than paying lip service to these consumer protection laws.

Avoid The Scammers By Doing This Instead

If you’re looking for help with your student loans, start with your servicer – that’s the company that sends you bills each month.

Contact the CFPB and/or Department of Education Ombudsman.

If that doesn’t help, reach out to a student loan lawyer.

There are better ways of making sure you don’t fall prey to one of these student loan scam companies.

Student loan services screwing 30 percent more troops and counting

When will the loan servicers stop the nonsense? Why isn’t the Department of Education holding their feet to the fire?

Consider this.  The Department of Justice (Justice, not Education), documented that Sallie Mae has been overcharging interest to active duty members of the military since 2005, in violation of the servicemembers Civil Relief Act (SCRA). According to the Federal Deposit Insurance Corporation (FDIC), Sallie Mae also illegally maximized borrower’s late fees and misrepresented how borrowers could avoid late fees. Yikes. The Department of Justice estimated that 60,000 servicemembers were harmed by the illegal activity of Navient (AKA Sallie Mae) and then earlier this year, the Department of Justice announced that the number of military borrowers receiving compensation under a settlement had increased by 30%, to nearly 78,000 borrowers. The Consumer Financial Protection Bureau (CFPB) recently documented ongoing incompetent and illegal loan servicing practices causing unique hardships for military families.  The CFPB noted that student loan servicers “still do not appear to understand the elements of the [SCRA]”.

Where has the Department of Education been during all this? First, they renewed Navient’s more than $100 million contract. Ack. Then, they took the matter under review. For a year. The results of ED’s review? ED reported that “the four servicers … complied in the vast majority of cases [with the law].”

Senator Warren called bullsh*t.  Because that’s the way she rolls.  Warren directed her staff to conduct a detailed analysis of the Department of Education’s review. Oh, snap! According to Warren’s review, the Department of Education’s analysis was “deeply flawed,” “failed to provide a full assessment of whether the student loan servicers were complying with SCRA,” and “failed to examine significant problems with servicemembers’ access to SCRA rate caps,” concluding,”[t]hese problems indicate that ED has failed to effectively assess, act on, or report on potential problems with administration of the SCRA program by student loan servicers.”

Read recommendations for change from the fantastic Deanne Loonin of the National Consumer Law Center –

Read recommendations for change from the fantastic Deanne Loonin of the National Consumer Law Center here:Senators Find Major Holes in the Department of Education’s Servicer Investigation. – See more at:

Making Student Loan Servicing Work for Borrowers

The Consumer Financial Protection Bureau (CFPB) asked for comments on student loan servicing a few months ago.  Thousands of borrowers and their advocates responded before yesterday’s deadline, highlighting again and again that the current system does not work well for borrowers and is not created to ensure that borrowers have enforceable rights to quality service and accessible relief.

We filed extensive comments with numerous examples of breakdowns in the current servicing system.  The second part of the comments focus on servicing of home mortgages.  We emphasized that servicing rules and protocols are more developed for mortgages than for student loans. Unfortunately, enforcement of the rules and protocols in mortgage servicing has been largely missing. This failure of enforcement should signal an area of concern for anyone developing a system for oversight of student loan servicing.

We also filed separate comments with the National Association of Consumer Bankruptcy Attorneys (NACBA) focusing on servicing problems faced by borrowers filing for bankruptcy.

We urge the Bureau, Department of Education and other agencies to carefully review these comments and recognize the harm caused by inferior servicing.   Student loan servicers are the borrower’s primary point of contact.  If the servicer is competent and efficient, many financially distressed borrowers will be able to avoid default.  The main problem with the current system is that student loan borrowers do not receive consistent quality service.  Combined with lax oversight and no clear way for borrowers to enforce their rights, too many borrowers never obtain options that could relieve their debt burdens and help them make fresh starts in life.

Unfortunately, the servicing system has become so confusing that an entire industry of for-profit “debt relief” companies has sprung up to supposedly provide the services that the free government servicers are failing to provide.  Borrowers run the risk not only of paying exorbitant fees to these companies, but also of losing important rights.

There is an urgent need to improve student loan servicing to help avoid default and ease the burdens of student loan debt.

How to Financially Navigate Your First Year as an International Student

This article is written by Anum Yoon. She is an international student currently working in the U.S. on her OPT. She spends all her free time running a personal finance blog for fellow millennials and international students over at Current on Currency.

Starting as a freshman at any college is always stressful, as there’s so many new experiences and responsibilities involved. If you’re an international student, it can be even more intimidating. As well as dealing with the pressures of college life, there’s the worries about living in a new country, using a second language and especially finance. The following tips will help you get to grips with your money, and make your first year as a student go smoothly.

  1. Understand Your University’s Payment Requirements

Payment options for your education will vary, depending on which college you decide to attend. These options will affect your financial planning for the year, so it’s worth finding out what’s needed from you as soon as you can. There are a few questions it’s worth asking before you start in the fall: Is payment for the fall semester required upfront in the summer? Is upfront payment required for each semester? Are monthly payments available, and are there international student fees to pay? Find out and then you can begin budgeting your tuition costs straight away.

  1. Open a U.S. Bank Account

If you have a bank account with a bank that only operates within your home country, it’s worth considering opening a bank account in the U.S. when you arrive. Otherwise, money withdrawals and transfers can become quite challenging. You’ll also notice that most citizens in the U.S. mostly use credit and debit cards to pay for things, even for small transactions. Having a U.S. bank account will make it easier for you to pay for necessities while you’re studying.

  1. Book Flights Early

International flights can quickly get expensive, especially when booked at short notice. To save money, book your flights for events such as moving in, orientation and college holidays as far in advance as you can. Your college may offer travel grants to international students, so it’s worth checking with them before you start booking your travel. If you’re planning to stay during holidays, make sure to check your accommodation regulations. Some on-campus housing closes during the holidays, so if you check first you can avoid paying out to stay elsewhere.

  1. Plan Your Getaways

There are multiple occasions during the school year that call for a getaway with friends. It’s not realistic for most international students to travel back home during every single break, so whether it’s a 3-day weekend or Thanksgiving break, it’s great to plan for these breaks ahead. Planning early will help you open up travel opportunities that are a lot cheaper and better organized. If you are on a tight budget, you can always see if any of your friends will be okay with inviting you over to their homes. Another fun idea that is good for low budgets are road trips. A road trip is a great excuse for you and your friends to explore your home-away-from home.

  1. Plan Your Indirect Costs

Your indirect costs are things like rent, groceries, and transportation. If you’re living on a budget, then there are lots of ways to save money. Having roommates is a good way of saving on household costs, and if you live on campus, you may be able to opt into a meal plan which will save money on food. Your college may offer all kinds of services for free or for a low fee, such as shuttle bus services and entertainment. Be sure to take advantage of them.

  1. Remember U.S.-Only Costs

There are a few financial customs that are particular to the U.S. you may not be familiar with. One example is tipping. In the U.S., gratuities aren’t added to bills in restaurants, so customers are expected to tip their wait staff 15 to 20 percent of the total to pay for their service. Not doing so can be considered rude, so it’s worth making sure what you should and shouldn’t be doing with your money while you’re studying in the U.S.

  1. Find the Best Options for Communicating With Family Back Home

While you’re away studying, you’ll want to stay in touch with your loved ones back home. Doing so can become expensive if you follow traditional routes, such as international phone calls or sending packages. If you want to call, consider using prepaid phone cards. If you’re sending packages, recycle packaging materials you’ve previously received, and research your best mailing options before you send them.

The Internet is a fantastic, and cheap, way to stay in touch. Social media sites such as Facebook allow you to chat online, and face call software such as Skype lets you make phone calls via your computer for free. Take advantage of what’s available online.

Managing your finances while living abroad can be a daunting thing to do. By following these tips, you can keep on top of both your tuition and personal costs, lifting one more worry from your mind.

How to Get Financial Aid as an International Student

Many colleges in the United States are making a big push to recruit international students to come and study. The sad truth is that this isn’t always an effort to diversify the campus. At some colleges, this is done to bring in more money. Unfortunately, international students often pay a lot more than U.S. citizens for the privilege of attending university thanks to fewer resources at their disposal.

Hope isn’t lost, however. While foreign students are at a disadvantage, financial aid is still available in different forms if you’re willing to look for it.

Merit-Based Scholarships

Tuition in the United States can be outrageously expensive at more than $50,000 a year. As shocking as that price is, discounts can be had through merit-based scholarships. According to U.S. News & World Report, 375 of ranked universities offered scholarships to international undergraduate students. The average amount of these scholarships was $18,790.

Some of the most generous scholarships came from the most prestigious universities in the country, such as Yale University – $56,630 average in aid to 349 students – and Harvard – $51,854 average in aid to 540 students.

Attending universities like those are out of reach for all but the absolute best and brightest students, whether they’re from the U.S. or not. Fortunately, all universities typically publish a list of many available scholarships, so check them closely and see if there are any you can apply for. Some of these scholarships are need-based and can be helpful depending on your background.

Outside organizations can also provide grants. The searchable database from the Foundation Center is a good place to start.

Student Loans

For U.S. citizens, federal student loans are fairly easy to obtain and often come with below-market interest rates. That support usually doesn’t extend to international students, but there are other avenues available depending on the country you come from or the program you use.

First, there is a way to get a U.S. federal loan if you’re an international student. Sallie Mae, the largest provider of federal loans, can provide you with a loan if you have a co-signer who is a U.S. citizen. This can be a trusted friend or a family member, but finding someone is often easier said than done. If you don’t pay the loan, then the co-signer who offered to help will be punished, so make sure you take that into consideration. Fill out an application on the Sallie Mae website.

Depending upon what country you come from, your own government or local bank might provide student loans to study outside the country. Check out this list from eduPASS to see what might be available.

Keep on Searching

Searching for financial aid can be overwhelming at times, but the end result will be worth your efforts. Even a tiny scholarship of few hundred dollars makes a big difference. Contact your university’s financial aid office for any opportunities. In addition to that, regularly browse the Internet to find any possible scholarships. Most students don’t even look, so you’re at an advantage if you’re always on the hunt.

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