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Friday, May 16, 2014

2014-2015 Direct Student Loan rates announced

The Department of Education has officially released the borrowing rates for Federal Student Loans. The official announcement can be found at this link.

See our infographic below for details on the changes. (Please feel free to share it)

Please note, that there are several type of loans students can use for borrowing money for college. While it's always best to avoid loans whenever possible,  loans are necessary if they make the difference between you completing your degree, and you dropping out.

Of all the loans possible,  Federal Student Loans are best types of loans to get. They offer protections, repayment plans (if one is not able to make the standard payment), have a grace period and require entrance and exit counseling, so borrowers have an understanding of how student loans can affect their lives.
The above rates are for Federal loans. If the loans you are offered (for the school year starting August/September 2014) do not match the rates above, please re-consider or even turn down those loans. They may become hazardous to your financial health!

Other types of loans include the following:

  • Institutional Loans - these are provided by the college, through their own resources. They are not necessarily the best loans, but depending on the college, might be helpful. They may also not have the protections Federal Student loans provide.
  • Private Loans - These may come from banks or other sources. They do not have the protections and rules that Federal Student Loans have, and interest rates will vary.  Note that banks used to provide federal student loans, and parents paying back federal student loans may be paying them back to a bank. But ALL current student loans are issued through the United States Government's Department of Education (also known as dept. of Ed. or most simply "Ed")
  • Payday Loans - People may be desperate if they find out they don't have money to pay for the semester. We suggest you avoid these at all costs. Interest rates are enormous, and the overall cost is general not worth it. Consider alternatives: deferred admission (where you can wait 1 year before actually going to the college), payment plans (where you can pay off your tuition in monthly installments)

We hope this helps as you or your student begins this tough-but-helpful process. 
Please leave a comment if you have a question about student loans, the FAFSA or the financial aid process.
JP Paulus of Do-Gooder Consulting works with churches and nonprofits, and even businesses to help them integrate college access training into their programs. We can do personal consulting as well as coaching for your staff.  More information is available at or call us at 872-222-8008 or by e-mail at for more information.