LOAN CONSOLIDATION WORKSHOP

Transcription

1 LOAN CONSOLIDATION WORKSHOP UNIVERSITY OF NEW MEXICO HEALTH SCIENCES CENTER April 17, 2014 April 23, 2014 April 29, 2014 Part of the Financial Rx Series

2 GOAL Review steps and screen shots involved with consolidating student loans Review when/why to consolidate Review types of repayment plans

3 OBJECTIVES Review screen shots involved with consolidation so you understand what you re looking at, what they re asking and, how to complete the process Differentiate between the various reasons to either consolidate or not to consolidate so you make the best choice, for you To learn some of the pitfalls of what (some) servicers might tell you regarding consolidation and why they tell you these things so you are clear about the information being given to you Review types of repayment plans and which you might want/need to choose depending on your long-range professional goals

4 NSLDS REPORT Must say graduated and the official graduation date before your loans can be consolidated. Add last 2 columns in preparation for consolidation!

5 FINDING YOUR (FEDERAL) LOANS Be sure to review the information on You will need: 1. Your SS # 2. Your DOB 3. First 2 letters of your last name 4. Your FAFSA Pin # If you have forgotten your pin #, go to ( Remember, if you ve changed your name while borrowing, look for all loans including those under your other name.

6 Consolidation site! Information for Public Service Loan Forgiveness!

7 PROCESS & SERVICERS Spring 2014 ALL borrowers will use the new Direct Consolidation Loan process The ONLY servicer for PSLF! With the implementation of the new Direct Loan Consolidation process, there are four consolidation servicers New Direct Consolidation Loan Process FedLoan / PHEAA Great Lakes Nelnet Sallie Mae 7

8 CONSOLIDATION LOAN APPLICATION - APPLICANT Upon clicking the Loan Application Link, the user is directed to the Instructions page which contains information on the purpose of the application, how a consolidation loan benefits the user, what the user will need in order to complete the application, and a Start Application button. 8 No save option so be completely prepared to finish.

9 STEP 1 CHOOSE LOANS & SERVICER By using the user s authenticated PIN data to retrieve the user s loan information from NSLDS, borrowers are able to select or deselect pre-populated loans. Users are also capable of adding additional loans. 9

10 STEP 1 CHOOSE LOANS & SERVICER Loans are displayed with loan type and loan servicer in the Select the Loans to Consolidate box; when the user scrolls over the loan type or loan servicer, more information is displayed. Weighted average interest rate!! 10

11 STEP 1 CHOOSE LOANS & SERVICER A pop-up appears when a user clicks the Add Loans button. In the case of any of the HRSA loans, i.e., HPSL, NSL, LDS, you must have the account #, balance, interest rate (5%), & the servicer = NMSL/NMEAF. NOTE: this is where you choose whether or not you want them to begin consolidation as soon as you submit the application. 11 If you re planning on PSLF, indicate yes & your servicer will be FedLoan Servicing/PHEAA.

12 Grace Period Option If applying for PSLF, indicate do not delay processing. If not applying for PSLF, you will likely want to utilize your grade period, i.e., 6 months, etc.

13 STEP 1 CHOOSE LOANS & SERVICER The dropdown within the Add Loan pop-up lists possible servicers for the user. For HRSA loans, you will indicate other and then complete the required information. 13 HRSA address should appear!

14 STEP 1 CHOOSE LOANS & SERVICER Under Servicer Selection you can select if you are consolidating for the purposes of Public Service Loan Forgiveness (PSLF). You can click the More Information link for additional information about PSLF. If you are consolidating for the purposes of PSLF, your servicer options will be restricted to the PSLF servicer (FedLoan Servicing/PHEAA). If you are not consolidating for the purposes of PSLF, you will select your consolidating servicer from a randomized list of servicers. 14 FedLoan Servicing/PHEAA, Great Lakes, Nelnet, or Sallie Mae.

15 STEP 2 REPAYMENT PLAN SELECTION The Repayment Plan Selection Page will provide high level repayment information/calculations, based on your consolidation loan s balance and interest rate calculated and displayed in Step 1 of the LC Application. 15

16 REPAYMENT PLAN SELECTION IDR TOOL Link to IRS This is where you give ED (loan consolidation) permission to access your most recent tax return, electronically, directly from the IRS. 16

17 REPAYMENT PLAN SELECTION IRS LINK 17 Click submit.

18 Repayment Plan Selection Result of IRS Link 18 The IRS will electronically transfer your tax return information.

19 REPAYMENT PLAN SELECTION RESULT OF IRS LINK Transferred IRS Tax Return information will display on this second conditional page associated with selecting an IDR plan. User may re-link to the IRS. Yes/No questions are presented asking the user to verify the transferred information (more questions appear conditionally upon the user s responses). 19 It is important to complete ASAP so your income isn t different from what your 2013 tax return indicates & you haven t begun work.

20 WHICH INCOME DOCUMENTATION? Depending on when you complete your application, you should be able to indicate no. You should be able to indicate no income depending on when you file your consolidation application. 20

21 CO-SIGN IBR/PAY AS YOU EARN/ICR REQUEST If you indicated married, filing jointly, the spouse must co-sign the IDR Request. The spouse may log in to co-sign during the same session, after the initiator has signed, via the page shown to the left. The spouse may return at a later time to co-sign. The incomplete Application can be accessed using the Co-sign Code. Even if spouse has no student loans, they MUST file for a FAFSA pin #. 21

22 CO-SIGN STEP 1 REVIEW SPOUSE INFORMATION General summary of IDR related information submitted by initiator is displayed for the spouse. Never do this!! 22

23 CO-SIGN STEP 2 CERTIFY & SIGN The spouse must fill out the Personal Information and co-sign the IDR portion of the LC+IDR Application. 23

24 STEP 3 TERMS & CONDITIONS The Terms and Conditions will consist of legal conditions and information relating to borrower rights, responsibilities, and understandings. The user is required to read through the LC Terms and Conditions in its entirety and click the checkbox with an associated message that states that the user has read and understands the LC Terms and Conditions. The user must mark the checkbox in order to continue to the next page of the flow. 24

25 STEP 3 TERMS & CONDITIONS The IDR Terms & Conditions also conditionally appear at the bottom of the Terms & Conditions step when an IDR plan is selected. Box to check!! 25

26 STEP 4 BORROWER & REFERENCE INFORMATION The user will be required to submit personal information along with information for two references. Note: If a user has previously submitted Reference information in a StudentLoans.gov application (i.e. PLUS Application, Exit Counseling), that information appears in a dropdown and can be selected. Otherwise, the user may supply a new reference. 26

27 STEP 5 REVIEW & SIGN 27 Box to check!! The Review & Sign page for the LC flow will display a summary of the following information provided by the user. Loans the borrower elected to consolidate Consolidated Balance and Interest Rate Length of time for servicer to hold application due to In Grace loan (if applicable) Selected servicer Selected repayment plan Transferred IRS tax information (if applicable) Family size (if applicable) Spouse Information (if applicable) Personal information References

28 IT S COMPLETE! - LOAN APPLICATION CONFIRMATION A confirmation page will be displayed to the user upon submission. Note: the servicer you have chosen will be displayed with contact information. IF you indicated interest in PSLF, it will ALWAYS be FedLoan Servicing/PHEAA. Be sure to print this for easy access! 28

29 DIRECT CONSOLIDATION LOAN APPLICATIONS Users can go back and reference their completed Direct Consolidation Loan application by going to the corresponding link under the My Documents tab. 29

30 APPLICATION PROCESS - CONSOLIDATION SERVICER Key actions by the consolidation servicer: Review the application and follow-up with the applicant as necessary Send Loan Verification Certificates (LVCs) to loan holders to verify loan payoff amounts Send Loan Summary to applicant 10 business days prior to funding giving the borrower the chance to make changes or cancel the loan. After 10 business days, the consolidation servicer will proceed with funding 30

31 APPLICATION PROCESS - CONSOLIDATION SERVICER Key actions by the consolidation servicer (cont): Upon completion of the borrower confirmation period, the consolidation servicer initiates a payment request from Treasury for each loan holder / servicer Determine the applicant s eligibility for the repayment plan selected Add a loan(s) within 180 days Borrowers have 180 days after the first disbursement of their consolidation loan to add a loan(s) to the consolidation Begin servicing and report to NSLDS the new Direct Consolidation Loan 31

32 If you chose PSLF & even though you checked the box on the application, you MUST complete this form, yearly! however, for 1 st year, complete it at the end of July of your 1 st year and, again, on June 30, 2015 = get you in the PSLF Pipeline!!! Public Service Loan Forgiveness - PSLF Employment Certification form. Page 1 YOU complete.

33 Page 2 GME Office or employment supervisor completes! Be sure to add your name & SS#, here!! Complete it, yearly, and maintain a copy of it & date you sent it in to FedLoan Servicing/PHEAA. You may have to complete it 2X s in year 1 since it asks for today s date.

34 RESPONSE TO EMPLOYMENT CERTIFICATION FORM Number of months being allowed towards PSLF, to date. Place of employment

35 REMEMBER Completing the Public Service Loan Forgiveness Employment Certification Form is merely a statement of intent and does not obligate you to continue pursing public service medicine. However, it is important to get in the pipeline, now, since there may be changes to the program and if you re in the pipeline, you will likely be grandfathered in.

36 REMEMBER You can consolidate all of your loans with any of the 4 TIVA servicers, i.e., FedLoan Servicing/PHEAA, Great Lakes, Nelnet, or Sallie Mae even if you have no intention of pursuing Public Service Loan Forgiveness. IF you are interested in pursuing Public Service Loan Forgiveness, you should express that at the time you consolidate and your servicer will always be FedLoan Servicing/PHEAA.

37 COMPARING Income-Driven PLANS Eligibility PAYE IBR ICR Eligible Loans Direct Loans Direct Loans & FFEL Loans Direct Loans Must be a "New Borrower" Yes * No No Payment Formula Protected Income 150% of poverty guideline 150% of poverty guideline 100% of poverty guideline Affordable Payment 10% of discretionary income 15% of discretionary income 20% of discretionary income Benefits Partial Interest Subsidy Yes (first 3 years) Yes (first 3 years) Yes (first 3 years) Loan Forgiveness Balance after 20 years (240 qualifying payments) -10 years if PSLF Balance after 25 years (300 qualifying payments) -10 years if PSLF Balance after 25 years (300 qualifying payments) -10 years if PSLF *New borrower: 1) No Direct or FFEL loans/balance as of 10/1/07 AND 2) Received Sub, Unsub, GradPlus disbursement on/after 10/1/2011 or Direct Consolidation based on application received on/after 10/1/11

38 FedLoan Servicing/PHEAA is THE Public Service Loan Forgiveness servicer. Site address:

39 IBRINFO.ORG Connects to studentloans.gov

40 DIRECT LOAN SERVICERS - BORROWER SERVICES (2014/Current) Federal TIVA Servicers Federal Servicers New Mexico Servicer FedLoan Servicing (PHEAA) DIRECT LOAN CONSOLIDATOR & ONLY LOAN SERVICER FOR PSLF MOHELA New Mexico Student Loan (NMSL) Tiburon Street, NE Albuquerque, NM Sallie Mae DIRECT LOAN CONSOLIDATOR ESA/Edfinancial Nelnet DIRECT LOAN CONSOLIDATOR Great Lakes Educational Loan Services, Inc DIRECT LOAN CONSOLIDATOR CornerStone Aspire Resources Inc Direct Loan Servicing Center (ACS) (PHASED OUT AS DL CONSOLIDTOR BUT MAY HAVE SOME LOANS!) Granite State - GSMR

41 DIRECT LOAN SERVICERS - BORROWER SERVICES (2014 Current) Federal TIVA Servicers Federal Servicers New Mexico Servicer OSLA Servicing VSAC Federal Loans U.S. Department of Education FSA Ombudsman Group 830 First Street, N.E. Mail Stop 5144 Washington, DC Phone: If you have problems with your student loans.

42 REMEMBER You can consolidate regardless of whether or not you are applying for Public Service Loan Forgiveness PSLF If NOT applying for PSLF, you can consolidate with the servicer who holds most of your loans, i.e., Fedloan Servicing/PHEAA, Sallie Mae, Nelnet, or Great Lakes AND, you can utilize Income-based Repayment (IBR) or Pay As You Earn (PAYE) regardless of whether or not you are applying for PSLF IBR and PAYE are great if you are applying for PSLF and/or as you transition to the next phase of your career and get started with your payments AND, you can always pre-pay if you have extra funds after you have figured out your budget BUT, don t be in a hurry to pre-pay if you re pursuing PSLF

43 THANK YOU Sponsored by: Ana M. Vigil, CON Financial Aid Officer Dianne Perea, COP Financial Aid Office Janell Valdez, SOM Financial Aid Manager Karen Sampson, SOM Financial Aid Officer Presented by Mary B. W. Fenton, MA Director, Student Financial Aid Services for the Health Sciences Center HSSB