Many college students today hit a hurdle before they even start when it comes to finding the funds necessary for college because they have already managed to run up a poor credit history. Fortunately however there are aid and loan packages available today which look principally at need and ignore your credit history and so this is where you will need to start your search for funding.

One of the oldest sources of funding and one which is chiefly available on the basis of economic need is the Pell grant. As long as the student and his family are considered to be a low-income family a Pell grant is more or less automatic and is made on the basis of the submission of supporting documentation.

The student will be required to provide proof of the cost of his intended course (including tuition fees and other qualifying costs) and will also need to provide details of the family’s income from which an EFC (Expected Family Contribution) number will be calculated. On this basis a decision will be made and the grant made or refused.

As the name suggests, a Pell grant is a ‘gift’ and not a loan and it does not have to be repaid. Pell grants are currently for a maximum of $4,731 a year (depending on your assessed financial need) and, while this will not normally cover the full cost of attending college, it can go a long way towards helping. However, most students will need to seek loan funding in addition to a Pell grant and the best form of loan funding initially are Stafford loans.

There are two different types of Stafford loan and the first is a subsidized Stafford loan on which the government pays any interest charges while you are studying full-time and for up to six months after graduation. The second type of Stafford loan is an unsubsidized Stafford loan on which you will be responsible for making all interest payments.

Unsubsidized Stafford loans need to be considered very carefully because, although you will be responsible for making interest payments, you will not be required to do so while you are in full-time education and for up to six months after graduation. However, during this period interest will still be applied to any loan and will simply be added to the outstanding amount of the loan. This means that during a three or four year college course your loan debt can grow substantially and reach a very significant sum by the time you do start paying it off.

Naturally, most students would prefer to have an unsubsidized Stafford loan but loans are disbursed according to the funds available and on the basis of need so that only a minority of students will qualify for a subsidized loan. The good news however is that most students will qualify for an unsubsidized loan and, despite their drawbacks, these still represent one of the best forms of college loan funding available today.

There are of course other forms of grant and loan funding available (and scholarships) and you need to shop around to see just what is available and best suits your circumstances. However for students from low-income families Pell grants and Stafford loans are invariably the best routes to follow.

By: Donald Saunders

Finishing up your education is a memorable happy moment in your life. But this moment also tags along the fear of funding the education process. There are scenarios when, the student won’t be having credit history at this stage. If you have a credit history then there is typically no problem for you to get the college loan. But if your credit history is not very good and you are afraid how you will be funding your college education; even then you need not to worry. Now there are many options available for bad credit collage loans.

The government thinks at this stage when the student is directly coming from high school and he might not have enough credit history so they do not take into consideration the bad credit or no credit history. So they are providing the facilities for the students so that their studies are not hampered.

The US Department of Education provides the facility of Stafford loan. It is further categorized as subsidized and unsubsidized. For subsidized Stafford loan, the government classifies the students based on their economic conditions. This loan is kind of an award for the student as accruing interest is paid by the government.

Whereas an unsubsidized Stafford loan is granted to any student and the student himself will be bearing the interest. Sometimes the amount is also much less which might not cover all the expenses for the student. So in the end students end up having multiple loans.

The other option available is the Federal Perkins Loans. These loans are again government subsidized loans which do not consider the bad or no credit history of the student. To avail this loan, the student has to be registered with a school/college or say the student should have enrolled for a course in the institute, only then he will be considered for the Perkins Loan. This loan is usually sponsored by the institute.

These grants are on a first come first serve basis. If a student is borrowing from multiple lenders with different interest rates, then he has the option to combine all the loans to one. He will be paying one installment only with comparatively less interest rate as compared to cumulative interest rate.

There is one more option available for students with bad credit history; scholarships. If a student has a good school record, he can get the full scholarship on the fees. But for this you a bit of luck on your side. In some cases the student is granted partial scholarships only and the rest he has to fund through loans.

If you have to avail the bad credit college loans, consider all the options by the government and start planning from your last year of school itself.

By: Adam Hefner

A student who is awarded one of the direct student loans needs to be attending a school that participates in the Direct Loan Program.

That student must first complete a FAFSA, and then he or she must sign a master promissory note (MPN). If the loan recipient then needs to talk with a counselor about the loan, those services can be obtained at the Direct Loan Servicing Site.

Services Available to Holders of the Direct Student Loans

At the Direct Servicing site, the holder of a direct loan can set-up an account. Using that account the holder of a direct student loan can view the record of his or her payments.

That site also contains records on the balance owing for each of the many student loans.

Anyone who has been awarded one of the direct student loans can use the Service Center to request use of electronic correspondence for the sending of bills and other information. Loan payments can be made free of charge from the Service Site.

Payments for any of the student loans can be scheduled as much as 6 months ahead of time.

The Various Types of Direct Student Loans

Some students with a direct loan have a subsidized Stafford Loan. The subsidized loan has an interest subsidy. All students awarded those direct loans can count on the government to cover their interest payments while they are still in school..

Not all Stafford Loans are student loans, and not all direct student loans are subsidized. Where students do not show tremendous need, the government might award an unsubsidized Stafford Loan.

Such unsubsidized loans do not come with an interest subsidy.

PLUS Loans represent a third type of direct student loan. PLUS loans are low interest loans for graduate students and parents. As with the other student loans, the application for the PLUS Loans entails submission of a FAFSA and a MPN.

Factors That Determine the Size of the Direct Student Loans

Not every student who receives one of the direct student loans gets the same amount of money. The amount of money awarded to the recipient of a student loan depends on three different factors.

The school costs will dictate to a large extent the size of the student loan. The government will also adjust its loan amount to account for any other aid that a student might expect to receive.

Finally, the distribution of funds for the direct student loans depends on the expected contributions from each student’s family.

After the Department of Education has examined those three factors, then it will provide a needy student with funds that should adequately cover his or her tuition costs.

Most students can get-by with loans of $8,000; they then obtain added money from additional on and off-campus sources.

By: Martin Haworth