Direct Student Loans
College Funding Straight from the Federal Government
Direct Student Loans are Federal Student Aid, FSA, loans offered through the Department of Education. Direct Student Loans provide affordable options for college students where they are available. The DOE serves as the lending agency for any Direct Loans.
Students must make sure that the college in which they are interested is a participant in the Direct Loan program. At the same time, financial aid professionals interested in enrolling their college in the Direct Loan program can do so through the Department of Education.
Applying
The student shopping for college loans must be able to have access to a number of different types of loans because most do not cover the whole cost of tuition on their own. Direct loans offer just one inexpensive option. Apply for a direct student loan by completing the online FAFSA, Free Application for Federal Student Aid, form. The DOE Direct Loan Program features a wealth of applicable information that students who need guidance might wish to access. The online library is full of information regarding Direct Student Loans, what they are and how they work.
Students who are approved for a Direct Student Loan will also be required to fill out a Promissory Note. This document is a legally binding financial contract between the borrower and the lender, in this case the student and the Department of Education. The promissory note includes a lot of legalese regarding the disbursement of the loan and repayment conditions. Students should make sure they understand all the particulars of this document before they sign. Students should also keep a copy for themselves.
Repayment
Students have a number of options when it comes to repayment of Direct Loans. There are options for income-based, graduated, extended and standard loan repayment plans. Graduates who possess multiple loans may also qualify for a Direct Consolidation Loan.
Direct Consolidation Loans
Graduates trying to balance repayment of multiple student loans might wish to investigate the DOE's Direct Consolidation Loan. A consolidation loan rolls the balance of all your student loans into one monthly payment. Typically a consolidation loan also has the advantage of lower monthly payments.
