Paying on time + in school = $1 million in rewards for Sallie Mae private education loan customers

NEWARK, Del., March 15, 2012 — Good habits can pay off, and Sallie Mae’s Smart Option Student Loan customers proved it. These students earned $1 million back in Smart Rewards for making payments on time while in school. The Smart Reward, introduced in 2010 by the nation’s No. 1 financial services company specializing in education, allows Smart Option Student Loan customers to earn back 2 percent of their scheduled in-school payments simply for making their payments on time.

“A borrower making in-school payments on a Smart Option Student Loan is a sensible way for today's students to establish a good credit history while managing their student loan debt," said Cheryl Williard, associate director of financial aid at Baldwin-Wallace College in Berea, Ohio.

Sallie Mae’s Smart Option Student Loan, designed to supplement federal student loans, assists students to save money, build credit, and repay their student loan faster. Customers are encouraged to make payments while in school to help minimize finance charges and the overall cost of the loan.

When Smart Option Student Loan customers choose to make payments on their student loans while in school, they can earn 2 percent of that scheduled on-time payment. They can choose either monthly interest payments or fixed, low monthly payments. That reward goes into their Upromise by Sallie Mae account and can be used to pay down their eligible Sallie Mae loan, transferred into a Sallie Mae High-Yield Savings Account or turned into a check for expenses like books.

“With the Smart Reward, good habits can turn into cash. By getting into the routine of successful loan repayment early in life, students can build a credit history and are better able to achieve other financial goals such as home ownership,” said Joe DePaulo, executive vice president of Sallie Mae. “We’re very proud of these customers who are making responsible financial choices and we’re happy to help them along the way.”

Sallie Mae advises families to follow its 1-2-3 approach to paying for college: first, tap college savings and maximize scholarships and grants. Second, explore federal student loans. Third, fill the gap with a responsible private education loan with your choice of in-school payment options to help you save money.

Contacts:

Debby Hohler, (617) 454-6741

Jennifer Zeberkiewicz, (302) 283-8206

Sallie Mae (NASDAQ: SLM) is the nation’s No. 1 financial services company specializing in education. Whether college is a long way off or just around the corner, Sallie Mae turns education dreams into reality for its 25 million customers. With products and services that include college savings programs, scholarship search tools, education loans, tuition insurance, and online banking, Sallie Mae offers solutions that help families save, plan, and pay for college. Sallie Mae also provides financial services to hundreds of college campuses as well as to federal and state governments. Learn more at SallieMae.com. Commonly known as Sallie Mae, SLM Corporation and its subsidiaries are not sponsored by or agencies of the United States of America.

The Eight Worst College Financial Aid Mistakes - Avoid Them

Contributing Author: Keith Maderer

With college costs rising faster than inflation and financial aid shrinking, you can't afford to make mistakes when it comes to sending your child(ren) to college. If you do... it will definitely cost thousands, even then of thousands of dollars per child. Now if you have an extra $5,000, $10,000 or $20,000 sitting around and don't mind giving it to a college... then this article isn't for you. For all others... Please read carefully!
Going to college can be a very complex and stressful time for many families. Especially with your first child that begins the process. While it may get easier with each child, if you make any of the following mistakes, it will cost you money.
If you are fortunate enough to be reading this while your oldest child is still in middle school or just entering high school, then you should have plenty of time to methodically make the most out of the college financial aid process. If your child is about ready to graduate or already in college, then you better get started right now and plan to spend some quality time making the adjustments necessary.
Eight Mistakes That will Cost You Plenty
Mistake 1: Not Starting Early Enough: The main reason families make costly mistakes during the financial aid process is that they wait until the last-minute and are rushed. If you start early and plan your steps on a timeline, you will be ready and prepared to take full advantage of the process.
Mistake 2: Not Paying Attention To Deadlines: Another big mistake is missing a financial aid deadline. If you don't file the right forms with the right departments before the required deadline, you lose the opportunity to get the financial aid for that semester and generally cannot reapply until the following semester.
Mistake 3: Not Filing The FAFSA: The dreaded first-time FAFSA (Free Application for Federal Student Aid) isn't as bad as most families believe it is, but if you never file it, you are guaranteed to be overlooked by the financial aid system. Most colleges require the FAFSA to be filed, even if you will not qualify for Federal aid, just so they can offer you any private scholarships, grants or endowment opportunities. So always file the FAFSA.
Mistake 4: Not Utilizing EFC Reduction Strategies: Every applicant that applies to college and requests financial aid will have an Estimated Family Contribution or EFC calculated based on the financial information that is provided. If you know how to use these EFC reduction strategies before you are required to file, you can lower your EFC and increase your financial aid dramatically.
Mistake 5: Student Loans: Many students and their families use the wrong types of students loans, don't use them at all or fail to look into which student loans are custom-made for their situation. A vast amount of information on student loans is available and all you need to do is read it. It will compare the different types and then you should be able to decide which is best if loans are required.
Mistake 6: Paying For College With Retirement Money: Every year I hear and read about parents that are tapping their 401K or other retirement plans to help pay for their children's college expenses. They either withdraw or borrow funds for education and neither method is a good idea for most families. Don't sacrifice your retirement for your child's education, because they probably will not be able to take care of you in retirement if you do.
Mistake 7: Not Appealing Your Offer: Appealing a financial aid offer from a college can be a great way to get additional aid, especially if you believe some mistakes or omissions were made when you initially filed. This is the time to clarify and correct any issues that you discover and request an adjustment if possible. It generally cannot hurt to ask for more and it gives your student the opportunity to make some great contacts inside the financial aid system.
Mistake 8: Not Asking For More... In Years 2 to 4: As a student continues through college, most never visit the financial aid office again after their freshman year. If you make regular visits each semester and inquire about additional aid, scholarships or grants, you may be pleasantly surprised by how much aid is available (and sometimes unclaimed), specifically for 2nd, 3rd and 4th year students.
Summary: This is a just a summary of the major mistakes that I hear about each and every year. Each of them is avoidable if you just take the time to do your research, get organized and plan your strategy. Obviously, the earlier you start, the better prepared you should be... so get started today and save a bundle.
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Keith Maderer is a financial expert, author, speaker and father of five. He has been a financial adviser in the Western New York for over 30 years. He is the owner of SENIOR Financial and Tax Associates and founder of the Maderer Foundation, a private scholarship program for area youth.  He is the author of the book, "How To Get Your College Education For Less.",

Federal College Loan Vs. Private College Loan

Contributing Author: Roger Ross

Student college loans are basically created in order to offer financial assistance to college undergrads as well as college graduates for them to be able to pay their university expenses including tuition fees, books and even for daily allowances. Pursuing a college degree is quite expensive that is why student college loans were designed to encourage students to provide assistance in continuing a college degree. Unlike other loans, student college loans have considerable lower interest rate attached to the loan with a very flexibility payment terms. The regulation of such loans may differ to the policy per government, but majority of the provisions are pro-student for the reason that this policy was ratified to create more degree holders.

In the US, there are various types of loans that are available to students. Theres the Federal Loan and the Private College Loan. The federal college loans are those that are provided from the states coffer. The government sets aside money to be allocated to students who are continuing with college education. This is the most availed type of loan as it is cheap to repay.

Many college students qualify for federal college loans. However, there are various factors that are measured before students are given the federal loans. Some of the basic factors include the income level of parents - the higher the amount of money earned by parents the lesser the amount of loan the student will be given. Other financial obligations are considered too.

Federal college loans are need based this means the amount of loan granted to the student would depend on how much he needs for his college education through a thorough evaluation both by the school and the government representative. The best part for this kind of loan is that there is no need for a credit evaluation.

Another type of loan in the United States is the Private loan. This loan is mainly offered by private financial institutions, such as banks and lending institutions, to substitute or sometimes to supplement if the government loan grant is not enough to satisfy college education in full.

Many students prefer this type of loan because it has faster approval and there is no need for a thorough evaluation and filling up of a federal aid application since it is not need based. The only problem with this loan is the charge of higher interest rate since it is offered by private entities.

Some students have accumulated bad credit and they can miss on the loan. But there are also institutions that will give the loans despite the history of bad credit. Those who excel in academics can get pass their bad credit history, whether from federal college or a private school loans.

The bottom line is, whatever types of loan a student would apply for, he needs to repay it because at the end of the day it still is borrowed money. The best thing to do is to use the loan wisely and go for that college or university degree.

College Loans

Choosing the Right College Planner

Contributed by Michelle J. Scott

It is the dream of every student to enroll into the best college after finishing their higher education. During such situations, most of the students feel great pressure since they have to prepare themselves to appear for SAT/ACT. Generally, it is necessary to take practice test to achieve good scores. Taking SAT/ACT test for more than once can benefit you. Also, seeking an expert and taking test from him can add benefit.

However, there are numerous consultancies or college planners available who assist the students and parents. It is always better to give good attention while choosing the right college planners. Usually the college planners assist in selecting the right college, preparing for SAT/ACT, and provide financial aid as well. Seeking the help from a good college can fetch u the following results:

1. Select the right career path: When the student chooses the right career path, he/she can graduate in 4 years where as most of them graduate in 5 years.

2. Selecting the right college: It is always ideal to choose the college depending on the student's academic, social and financial ability.

3. College application: Since there are many colleges in the nation, the students get an opportunity to apply in more than one college. The student has to utilize it and apply for at least 6 colleges according to the experts.

4. Minimizing the college cost for the families: Since the number of students who graduates in 4 years by seeking the help of college planners are high, the financial aid is assured for such students then the others.

5. College experience: A good and successful college experience creates confidence, self-esteem, and acquires family pride as well.

Many college planners or education consultancies offers many programs to ensure opportunities for success. Some of the programs that are necessary are:

1. Student career search to access on-line aptitude/attitude test

2. College Tracking List that provides all the information on anticipated completion of each step

3. Student positioning session, mainly telephonic session, that helps the student to choose the right college

4. Completing CSS forms and financial aid forms provided from college

5. Fill up the Free Application for Federal Student Aid. 90% of these forms are submitted with errors, it is very essential to give due attention to get financial aid

6. Counseling with the family regarding the loan and budget option

7. Providing complete customer service

It does not matter how much you spend for SAT prep course or ACT prep course. It is the marks you score as a result of taking these tests matters.

SuccessfulEducationSolutions.com is the official website of Successful Education Solutions. They are best and well known college planners in Danbury. They assist the students in preparing for SAT prep course or ACT prep course and college essay help. They also help parents by providing financial aid.

For more information visit: http://www.successfuleducationsolutions.com/

Teaching Your Children How To Manage Their College Debt May Be The Best Route To Take

Student loans are a serious undertaking, and many parents wonder if they should take out loans on behalf of their child or else allow the student to have primary responsibility for the loans. Many parents wish that they could pay for their children's education in full, but the rising costs of education often make this prohibitive. As a parent, should you foot the bill and the debt for your child's education? You may be surprised to hear that you may be doing more good for your child if you let him or her take responsibility for college funding.

As a parent encouraging your child to be responsible for his or her student loans, your role in your son or daughter's college funding is not without risk. After all, you will likely serve as a co-signer for any loans your child takes out. This means that while you will not be the primary loan-holder, you still assume partial responsibility for the loans and will be adversely affected if your child does not handle her or his loans in a responsible manner. You will want to be sure that your child is truly serious about college and is able to take on debt responsibly.

Making it clear that your child will be financially responsible for a college education will likely influence him or her to make a smarter college choice. After all, when mom or dad is footing the bill, a student may opt to attend a costly private college. If students are forced to take out loans in their own names, however, they are likely to select a more economical college that meets their needs, such as a state school.

Managing his or her finances independently will help your child to learn responsibility. After all, handling money is something every student should learn, and college is certainly the time to instill a sense of fiscal accountability in your child. By managing student loans and figuring out a college funding plan with only minimal assistance from you, your child is learning valuable money-managing skills that will benefit her or him in the future.

Paying back the student loans post-graduation is an important lesson in interest, repayment plans, and budgeting carefully in order to afford payments. Your child will learn a lot from having to navigate the terms of his or her student loan debt.

Furthermore, having loans will compel your son or daughter to have a goal in during college, as well as a deadline for finding employment upon graduating. After all, those student loans will come due before you know it. Without the worry of student loan debt hanging over their heads, many students lack focus during college. They are often in no hurry to graduate and grow up, unless given a very compelling reason to do so.

Students who are held financially responsible for their education also tend to do better in college because they are aware of the monetary value of their education. They get better grades and have fewer absences, since they are paying for every course on their own.

As a parent, it is hard to know when to step in and help your child or when to insist that he or she take responsibility in regards to debt and financial aid options. When it comes to student loan debt, taking the "tough love" stance is a good way of instilling ownership and responsibility in your children as they pursue college or online school.

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College Students and Loan Payback: Lending Agencies Make Profits Preying on Students and Parents

Student lending organizations and collection agencies make money various ways. One of the most profitable is to convince graduates, who have already borrowed to pay tuition and fees for four years, to take out further loans for advanced degrees.

The agencies defer interest payments on the original loans until the student graduates with his or her new degree. Then they add the amount of the interest deferred on the original loans with the interest deferred on the graduate school loans to the principle on both the first four years and the advanced degree to arrive at a massive amount of money owed by the graduate.

Jorge Was Such a Student

I sometimes write about a wonderful young man whose name was Jorge. He was the first of his family to attend college. To do so Jorge had to take out student loans. He could not get a job after his four years so a representative from a collection agency suggested he earn an advanced degree. Although the lending agency deferred his original loans, they accrued interest and, along with his new loans for graduate school, came to an extraordinary amount (over $150,000).

Jorge, as with most students, could not get a professional entry-level position after he earned his graduate degree. The pressure from collection agencies was so great that he felt he had no choice but to take his own life. (I continually counsel graduates in this situation that suicide is never an acceptable alternative.)

Student Loan Organizations Make Lots of Money Off These Unfortunate Students

Many students still cannot get jobs after graduate school, and neither the banks who loaned the students their money, nor the collection agencies are sympathetic to this situation. Quite frankly, this is a successful gambit of the student loan industry: Lend students lots of money, defer these loans for many years during which they earn lots of interest, and charge huge late fees and collection agency charges when the graduates cannot pay them back.

Parents Often Use Their Own Savings to Pay the Loans

If the student does not commit suicide (many lending agencies can collect insurance on the loan) the lending agency (including the Department of Education) passes the loan on to collection agencies who will put an excruciating amount of pressure on these hapless graduates. The unemployed graduates often have no choice but to appeal to their parents to help them out of their predicament. The parents, who are now preparing for their own retirement, are now forced to take out a mortgage or home equity loan. Then the student loan (in many cases in excess of $100,000) is now paid.

Think of what has just happened here. The lending companies and collection agencies have extended exorbitant amounts of debt to students who never had any chance of paying their loan back. When mom and dad pay back the debt with their own retirement savings and home equity loans, the agency makes huge profits on the current interest, deferred interest, collection fees, late fees and various other charges.

Politicians Also Make Money Off Student Loans

No wonder the lending agencies dole out so much PAC money to politicians. They need to keep bankruptcy, as an alternative, out of the picture. If the government passed a law that gave graduates the same right to declare bankruptcy as other citizens, a major form of revenue for the lending industry and politicians would be destroyed.

My point is that there is no excuse to refuse bankruptcy to any graduate who reaches such a point of destitution. When graduates take their own lives or parents lose their life assets and life savings to help their children out of this mountain of debt we must change the laws.

This article was created by J Roberts also known as Professor Roberts. He is a noted counselor to parents and students alike and is the author of the book "Colleges Behind Closed Doors: What You Need to Know (Long) Before You Go." He is an authority on the inner-workings of colleges, college preparation, selection, and finances. Visit him at http://www.ProfessorRoberts.com.

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Don't Let The Average College Tuition Cost Stop You

Is there a legitimate way to beat the average college tuition cost these days?

That was a question my wife and I had as our son was close to completing his senior year of high school.

We did some painful research and discovered that average college costs had increased "a little" from 30 years ago when we attended college.

When I say " a little", I mean a little too much to believe. State college tuitions for 1 year in 1978 was around $1000 in the South. Now, you are looking at $6000 - $8000 a year.

This is outrageous. And I am not even including room and board or miscellaneous expenses.

It gets even more unbelievable. If you look at the private universities, tuition shoots even higher to around $30,000 a year or more. Harvard University, here I come.

Our son wanted to get a bachelor's degree in business. We didn't know how we could possibly afford it.

We were not going to go the route of student loans either.

We found out that necessity truly brings forth inventive ideas. Maybe it was just stubbornness on our part.

Whatever it was, we were determined to find a way to make this work, and did we get the surprise of our lives.

There is actually a very simple way to slash the average college tuition cost.

You can do this by using 2 testing credit services: CLEP and DANTES.

Both of these testing service programs provide a college student with the opportunity to obtain college credits in a variety of courses.

CLEP offers 33 college level courses in literature, the foreign languages, history and social sciences, science and mathematics, and business.

DANTES originally was developed for military personnel, but is now available to anyone. They offer testing credits in 38 different college level courses. Their courses also cover a variety of subject areas such as math, social sciences, humanities, business, physical science, and technology.

How much can you save with this strategy?

You can easily save more than 50% from the cost of college tuition.

These tests are taken at testing centers across the country. All you need to do is find a center close to you and register to take a test of your choice. These tests are almost all multiple choice, but you definitely need to be well prepared.

We have done it and so can you if you take the right steps to get prepared!

The great news is that today's average college tuition cost is no longer an obstacle to your college degree.

Get more details on how to slash today's AVERAGE COLLEGE COST by more than 50%.

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