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Frequent Contributor
pjxf99
Posts: 336
Registered: ‎04-14-2008
0

Yet another student loan question

Way back in, I think, 1998, I missed student loan payments (120 days). I remember filling out a form for a sort of back-deferral, paying a fee...
 
My credit was faffing about in the mid 600s there for a while, til I got my act together. Now my scores are 740-760.
 
I want to go to grad school in the fall, and was concerned about money. Before I received any financial aid info from the schools, I noticed that I could pre-qualify for a grad PLUS loan online in "just a few minutes!" I thought this would at least make me feel better, even if I don't decide to apply for it.
 
I almost had a heart attack when it came back with "Your credit is denied. Your credit history does not qualify you for this loan." (or something to that effect)
 
Um, help? Why? I've worked so hard to get everything straightened out in the last several years and this is just very frustrating.
 
I won't get into too much unnecessary detail here, but if you need more info just ask.
 
I am supposed to get an explanatory letter in 7-10 days, but I'm going to stress out before then. I'd appreciate any help!
FAKO TU: 730 (Too poor to check the real scores these days!)
New Contributor
smg53
Posts: 70
Registered: ‎06-23-2007
0

Re: Yet another student loan question

Here are the general PLUS Loan requirements:
 

An applicant cannot be:

  1. 90 days or more delinquent on the repayment of any debt; or
  2. The subject of a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment or write-off of a Title IV debt during the last five years. If you have an adverse credit history, you are eligible if someone with no adverse credit history (other than the student) agrees to endorse your loan, or if you can document to the Department’s satisfaction that you have extenuating circumstances. If you are in default on a loan or owe an overpayment on a grant, you may still be eligible if you’ve made satisfactory repayment arrangements.
  3. You might want to pull your credit reports and see what may be triggering the denial.  PLUS loan applicants who are denied on their own can apply with an endorser.  Also if you are able to fix whatever is triggering the denial you still may be able to get approved.

    Good luck!

      Frequent Contributor
      pjxf99
      Posts: 336
      Registered: ‎04-14-2008
      0

      Re: Yet another student loan question

      Ohhhh....no matter how long ago?
      :robotsad:
       
      Do you happen to know if this also affects Stafford loans?
       
      FAKO TU: 730 (Too poor to check the real scores these days!)
      New Contributor
      smg53
      Posts: 70
      Registered: ‎06-23-2007
      0

      Re: Yet another student loan question

      Stafford loans are not credit  based so as long as you are not defaulted on any federal student loans then you are eligible.  You do need to be a half-time student to get Stafford loans though.
       
      Regarding the PLUS...if the late was in 1998 is it still showing on your credit report?  That seems like a really unfair punishment for one late.
      Regular Contributor
      Drachen
      Posts: 121
      Registered: ‎03-11-2008
      0

      Re: Yet another student loan question

      The people who have replied above are right.  The PLUS loan is meant to be in addition to Stafford loans anyway.  You are likely not going to get a better rate than the (current 6.8%).  The only disqualifying factors for a Stafford loan are if you are not a US Citizen (or tax-paying non-citizen), if you have ever been convicted of a felony drug charge WHILE using financial aid, or if you are currently in default on any federal Stafford loans.  As a graduate student you will be able to borrow up to a maximum of $20,500 a FINANCIAL AID year (defined as 8 classes or 24 credits).  Let me know if you have any other questions regarding this.  I work for a University as an Enrollment counselor and do this stuff all the time.
      05/25/07: TU-567, EQ- 570, EX-546
      03/19/08: High:668 Mid:662 Low:649 (don't know which is which, got it from mortgage broker)
      04/21/2008: EQ-696
      Frequent Contributor
      pjxf99
      Posts: 336
      Registered: ‎04-14-2008
      0

      Re: Yet another student loan question

      I do have questions actually, and I would really appreciate that, but I don't want to get too off topic here, lest I anger the Mods:smileyhappy:
       
       
      Does EFC affect the amount of Stafford loans I can get? Mine came up unreasonably high, and one of my instate schools is low tuition.
       
      Back to the PLUS loan, one school gave me a financial aid statement that includes a PLUS loan (along with sub and unsub Stafford). I have yet to be admitted to this school, so I was really confused. I was directed to "activate" my loans.  When I asked them what that meant I got a standard non-answer. I went ahead and did it. So was this just a list of financial aid I *could* in theory have, since I don't qualify for the PLUS? If so, how exactly is that helpful? And that's not what it looked like: it had all my FAFSA info listed...
       
      You deal with this every day? How do you stay sane?!
      FAKO TU: 730 (Too poor to check the real scores these days!)
      Frequent Contributor
      BoysMumx2
      Posts: 309
      Registered: ‎01-24-2008
      0

      Re: Yet another student loan question



      pjxf99 wrote:
      I do have questions actually, and I would really appreciate that, but I don't want to get too off topic here, lest I anger the Mods:smileyhappy:
       
       
      Does EFC affect the amount of Stafford loans I can get? Mine came up unreasonably high, and one of my instate schools is low tuition.
       
      Back to the PLUS loan, one school gave me a financial aid statement that includes a PLUS loan (along with sub and unsub Stafford). I have yet to be admitted to this school, so I was really confused. I was directed to "activate" my loans.  When I asked them what that meant I got a standard non-answer. I went ahead and did it. So was this just a list of financial aid I *could* in theory have, since I don't qualify for the PLUS? If so, how exactly is that helpful? And that's not what it looked like: it had all my FAFSA info listed...
       
      You deal with this every day? How do you stay sane?!





      I can answer the EFC question - EFC doesn't impact your Stafford loans (I know this from my experience this year), as they aren't need based. They are based on the total Cost of Attendance for your program. The max per financial aid year on Stafford secured/unsecured combo is $20,500 (as noted above), which means that your COA for that particular school must be quite a bit higher than that so you were offered the PLUS loan as well.

      Starting Score: EQ 622, TU 676, EX 643 (mtg lender pulls) 2/1/12
      Current Score: EQ 743, TU 775 (6/18 MyFico), EX 722 (per CITI approval letter 6/29/12 pull)
      Goal Score: New goal: 760+ on all 3


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      Regular Contributor
      Drachen
      Posts: 121
      Registered: ‎03-11-2008
      0

      Re: Yet another student loan question

      [ Edited ]
      I am sorry, I didnt see the question before. Please forgive me.  The EFC SHOULD not affect your Stafford loans, but in some bizarre cases it can.  The Stafford loan is split into a subsidized portion, and an unsubsidized portion.   The US Govt pays your sub interest while you are in school, and the unsub accrues interest to the principal while you are in school.  That 20500/financial aid year limit is actually 2 limits.  You have an $8500 limit/financial aid year for sub, and the remaining 12000 is unsub.  If your EFC is ridiculously high (I have only seen this once) then you may not qualify for the sub portion.  Unfortunately, the unsub doesnt just grow to give you the full 20500, 12000 is the limit and that would be all you get.  As far as "activating your loan," I have no clue what that means.  Once the school knows that you have FA wrapped up and you are admitted, they should request the funds from your lender.  There is no "activation."  Do you remember what the non-answer was?  As far as why the PLUS loan was listed on there, maybe they printed that out to show you the best way to handle your total tuition cost.  After stafford, PLUS is the next best educational loan.  I guess they didnt know you couldnt qualify, and now you have to take out some kind of private loan to take care of the rest.  It seems like going to this expensive school is going to be a big headache for you.  The other school may be a better option. 
       
      Oh and I am really good with numbers, and love working with them so I can stay sane.  Although, sometimes dealing with the Dept of Ed can be frustrating.  :smileyhappy:
       
      PS  Private message me if you have any other questions,  that way I will see them.


      Message Edited by Drachen on 04-24-2008 03:08 PM
      05/25/07: TU-567, EQ- 570, EX-546
      03/19/08: High:668 Mid:662 Low:649 (don't know which is which, got it from mortgage broker)
      04/21/2008: EQ-696

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