Graduate Financial Aid

Tuesday Rant (a tongue-in-cheek observation)

Believe it or not it’s still possible in 2009 to get three squares a day, a roof over your head, and a college degree for the bargain basement price of $0. So how can you get a piece of this all American pie? Simple. Get arrested.

Correctional education, perhaps the greatest perk of all for inmates, involves vocational training or academic education as part of a prisoners rehabilitation and preparation for life outside prison. It’s these educational programs that allow many inmates to emerge from behind bars in better shape, financially speaking, than many law abiding citizens who are struggling mightily to make ends meet due in large part to sizable student loans payments. Most graduate students these days carry debt totalling over $40,000 and face monthly payments in excess of $400.

Between teachers volunteering their time and publishers donating books, as is the case at San Quentin State Prison in California, inmates are getting a top flight education for free. How fair is that? I’ve got the perfect slogan for a state penitentiary. “Commit the crime. Do your college time. All on the taxpayers dime.”

I guess all that’s left is to determine which non deadly crime will get you 4-5 years behind bars. I’d really hate to see someone paroled early prior to getting their bachelors degree in criminal justice, that would be just tragic.

From Student Loan News, Updates and Blog Posts » Graduate Loans:

Yes, your federal loan details can be accessed online through the Department of Education’s National Student Loan Data System (NSLDS) database.
The NSLDS database holds all your federal loan details. If you’ve just applied for aid, don’t expect to find any information on NSLDS yet. NSLDS gets its information from schools guaranty agencies and U.S. Department [...]

Originally published by Student Loan News, Updates and Blog Posts » Graduate Loans.

Degree Mills, which produce phony degrees, have been around for over a hundred years and have helped thousands of people find employment. Of course if the human resource department did their due diligence at the time of hire these cheaters would not thrive at all, but many are too trusting and take the credentials listed on ones resume at face value.

The superintendent of school’s for California’s second largest school disctrict lost his job and faced serious legal consequences when the Stanford Ph.D he had claimed for years turned out to be a phony one. The chairman of the board of a major Florida university resigned, after it became known that he had bought his degree from an Oklahoma diploma mill.

The Federal Bureau of Investigation actually has a division called DipScam, which was launched back in the 1970’s, and is committed to investigating diploma scams. That’s how big the problem has become. In fact, in one operation they accumulating over 7,000 client names from a diploma-mill raid, and the FBI identified more than 200 federal employees in the batch, including 75 in the Defense Department with bogus degrees! Just mind boggling.

It may also trouble you to know that newspapers and magazines continue to allow these perpetrators to advertise. Next time you pick up The Economist, USA Today, Forbes, Psychology Today, Inc., Discover, Investors Business Daily, and the regional editions of Time and Newsweek keep an eye out for these second rate operations.

Do I endorse buying a phony degree? No. Have many people jump started or furthered their careers with phony degrees? Yes. Every man has their own code of ethics and personal standards they must follow. You can roll the dice if you want, but just remember the house usually wins.

The graduate plus loan has become a very popular loan amongst graduate students over the past few years. What makes it enticing is the fact that it is a Federal loan even though you have to pass a credit check in order to be approved. It also can be combined with your Stafford loans from undergraduate school and grad school once you are completed with your studies.

A problem that some people face is getting approved for the loan. Many people have asked me how exactly the decision is made for approval on these loans. The approval process is not as stringent as private loan approvals. They also don’t require that you have an extensive credit history or even a steady income. What the lenders look at is if you have an adverse history on your credit report. If you do, and it’s not cleared up it will affect you from getting the loan. If you have something on your report from 2 or 3 years ago, that is cleared up, you should still be approved for this loan, however they may require that you add a co-borrower.

Another common question I get with this loan is if you can apply with a cosigner right off the bat. The answer is no. It is required that you apply on your own first, and if you get denied, you will then be given the opportunity to add a co-borrower. I also recently received a question on the financial aid forum regarding defaulting on a credit card and if this disqualifies you for receiving a grad plus loan. If this situation was resolved and account is now current, you should still be approved. However if the situation was very recently, chances are you will need a cosigner. However defaulting on a personal loan or line of credit is not the same as defaulting on a federal student loan and does not disqualify you for borrowing more Federal loans. FOr more information on the graduate plus loan, visit the GradPlusLoans.com information page.

Monday Rant!

Why do graduate students need to submit letters of reference? The official reason is that letters of reference are designed to promote applicants qualitative abilities. What the school hopes to discover is specific descriptions and examples which illustrate a students potential to make a difference in the world. Personally, I find this part of the application process laughable.

Depending on the school, you’re required to submit 2 to 3 letters of recommendation. This antiquated, and in my view, irrelevant practice should die like the hornets in my gutter as any student with good grades can get a professor to essentially type a form letter.

If you’ve been out of school for a lengthy period of time you’re allowed to use work/personal references. I know three graduate students who actually typed their own letters of reference and then had their references sign it. The process is a joke and the professor’s many times are a joke too.

Having to rely on incompetent professors to ensure your entrance into these programs is simply ludicrous. Perhaps this process works at top tier schools where professors enjoy ego stroking themselves and their top students, who in turn enjoy the attention and need the validation; but at the State level the requirements should just be one letter of recommendation sent by the professor’s choice of media (I would say do away with the reference completely but I know that won’t happen).

Anyone who has gone to school knows that professors can be absent minded. My one reference requirement allows you to hedge your bet. With a one reference requirement you could ask three professors to write a letter, knowing that one would come through and not hold up the process for you. The extra letters (assuming they actually did them) could then be optional.

I realize schools are trying to delineate between worthy candidates, but the reference letter devalues this process. You might as well pick up a magic 8-ball and shake away. Will I get into graduate school magic 8-ball? “Ask again later.”

I realize that it has been difficult lately trying to get loans to pay for tuition, nevermind getting a loan just to help you out with other expenses while you are in school. With the way the economy is now many loan companies have ended certain loan programs leaving just school certified private loans that usually require a cosigner. I receive a lot of inquiries from med students who need help with moving costs they endure when they begin their medical or dental residency. There are now two new loans that you can get to help you with these costs, and they are specific for your needs. Here is an overview of each loan:

Medical Residency Loan
Medical Residency/Relocation Loan is available to those pursuing a career as a health professional in an allopathic or osteopathic residency program. Medical students and new residents often face costs not traditionally covered by financial aid award packages. The Residency/Relocation loan will cover expenses related to medical board exam preparation, participating in residency interviews, relocating for residency or other related expenses (e.g. transportation, housing, groceries).

Benefits:

* Borrow up to $20,000
* 1.0% interest rate reduction at repayment*
* 0.25% interest rate reduction for using ACH**
* Up to 15 year repayment term with no prepayment penalties
* Defer payments up to 7 years during residency program
* Cosigner release option available after 48 payments, if applicable
* All loans serviced by Graduate Leverage Servicing
* 24/7 account access
* Electronic application

Eligibility Requirements:

The Medical Residency and Relocation loan offered in partnership with the Student Loan Network and Graduate Leverage is available to those pursuing a career as a health professional in their final year of medical school and for six months following graduation. If the borrower is not a U.S. citizen or permanent resident, a cosigner who is a U.S. citizen or permanent resident will be required.

If the borrower is the sole applicant, they must be at least 18 years old in all states with the exception of 19 in Alabama & Nebraska and 21 in Puerto Rico. If they do not meet age of majority requirements in their state, a cosigner will be required. Additional qualifications apply.

The interest rate for this loan is LIBOR + 5.0% to 8.0% (variable rate***).

Dental Residency/Relocation Loan
The Dental Residency/Relocation Loan is available to those pursuing a career in dentistry. Dental students often face costs not traditionally covered by financial aid award packages. The Dental Residency/Relocation loan will cover expenses related to board exam preparation, participating in interviews, relocating for a residency or an internship and other related expenses (e.g. housing, transportation, groceries).

Benefits:

* Borrow up to $20,000
* 1.0% interest rate reduction at repayment*
* 0.25% interest rate reduction for using ACH**
* Up to 15 year repayment term with no prepayment penalties
* Defer payments up to 7 years during residency program
* Cosigner release option available after 48 consecutive, on-time payments, if applicable
* All loans serviced by Graduate Leverage Servicing
* 24/7 account access
* Electronic Application

Eligibility Requirements:

The Dental Residency and Relocation loan is available to those pursuing a career in dentistry in their final year of dental school and for six months following graduation. If the borrower is not a U.S. citizen or permanent resident, a cosigner who is a U.S. citizen or permanent resident will be required.

If the borrower is the sole applicant, they must be at least 18 years old in all states with the exception of 19 in Alabama & Nebraska and 21 in Puerto Rico. If they do not meet age of majority requirements in their state, a cosigner will be required. Additional qualifications apply.

The interest rate is LIBOR + 5.0% to 9.0% (variable rate***)

For more information on these loans you can visit Gradloans.com.

You know the market is tough when Harvard University is holding seminars on how to handle rejection. Yep, I’m afraid the days of the red carpet being rolled out for freshly minted college grad students are gone – or at least temporarily suspended.

Many experts advised while the job market was slumping it would be prudent to go back to school, beef up your skill set, get your MBA, and resurface ready to market yourself and land that high paying job. But those dreams appear to be just that – dreams.

What graduate students find awaiting them now is a heap of student loan debt and an even more competition job market than when they entered grad school. In April of ‘07 the unemployment rate was at 4.5%, opposed to the staggering 8.9% we currently see today (the highest it’s been since September ‘83). As good as your alumni network is you’re asking a lot to land a high paying job right now. More polished candidates with years of experience are scooping up those jobs, and doing so for thousands less than their degree would have garnered them a few years ago.

Things will turn around as Warren Buffet said earlier this year. “Amid this bad news never forget that our country has faced far worse travails in the past…and we’ve overcome them.” Buffet was referring to the two World Wars and Great Depression that has plagued our nation. But those words ring hollow to those who don’t have a billion in the bank. For them the future can’t get here soon enough.

If you are having trouble making ends meet (click here) for a free debt consultation quote.

Five most recent graduate financial aid blog posts:

Subscribe to RSS headline updates from:
Powered by FeedBurner