Student Loans

We are now offering Alternative Student Loans, in addition to Stafford and Parent Plus loans. For more information and to apply click here.

Being a student at a college or technical school is hard enough before one even thinks about the money problem. School classes and homework require time, so holding down employment is pretty much a part-time ordeal at some low-wage job to make ends meet. Then, when you're barely making your living expenses, the tuition and books come at the beginning of each semester and you scramble to make that payment. Sure, Mom and Dad put away some money for your schooling, but the tuition climbed faster than their savings account, so long ago that account was depleted.

Freedom Community Credit Union offers a means of getting those college bills paid through our Student Loan program. The benifit: payments for a student loan are deferred until the student is in a better position to pay it back.

Unlike other forms of consumer loans, student loans don't require the students to make payments on them while attending school. This doesn't mean the bank isn't making money on the loan, but it means you don't have to pay anything until you are out of school; at that time (when you've presumably got a job) the entire amount owed will be tallied and a payment schedule arranged for that amount. Your Credit Union deals principally with Federally-backed student loans.

There are some differences between federally-guaranteed student loans, all involving interest and how it is paid to the bank. These are:

1. Federal Stafford Loan: The best deal of all, this loan has the interest paid for you by the Federal Government while you're in school. In other words, to the student, the interest doesn't start costing him/her money until after he/she gets out of school. As you might guess, this is also the toughest to qualify for.

2. Federal Unsubsidized Stafford Loan: Meeting most of the provisions of the subsidized Stafford Loan, this loan makes the student responsible for interest that accrues during the time the student is in school. So, when the student gets out of school, he/she will owe the principle plus the accrued interest over those years and will make payments on that amount.

3. Federal PLUS Loan: This Federal program is available to parents of dependent students. There is no Federal interest subsidy (as with item 2), but the loan limits are more liberal than the first two mentioned above.

Guarantees and Loan Limits

First, all the loans above are Federally Guaranteed Student Loans. Unlike other consumer loans where the individual must rely on his/her own payment track record (credit rating) to qualify for loans, the U. S. Government assures the banks involved that they will get their money back. This guarantee gives banks an incentive to provide the money for these loans so students are assured of access to the money. Also, interest rates are set by the government, so all participating credit unions and banks charge the same amount of interest to the student.

Of course, with the Federal Government backing the loan, its interesting to note these student loans cannot be made part of a bankruptcy proceeding. In other words, if a former student finds himself/herself trying to file bankruptcy in an effort to rid themselves of the loans, forget it. Student loans will stay with you until paid. If you're interested in knowing what the Government does with those not paying them back, check the legal section in the newspaper every week.

Application Process

The first place you'll visit to get a GSL is the Financial Aids office at the school you want to attend. This visit should be immediately after getting accepted into the school. There you will determine if you're eligible for a loan (almost everyone is eligible for something). They will also have you fill out a FAFSA (Free Application for Federal Student Aid) application, which is then sent out and your needs evaluated (as you might guess, the Federal Government wants to know a lot about the person they're providing the guarantee for). From this FAFSA application, you will receive an awards letter stating what you're eligible for.

After receiving the awards letter, you'll bring it to the Credit Union and visit with one of our loan officers. You will receive another application that will have to be filled out both by you and the same Financial Aids office you were at before (this is Government, so expect paperwork). After the school fills in their part of the application, you bring everything back to the Credit Union where we will send it out for funding.

Other GSL notes

GSLs are a reasonably painless means of getting money necessary for your education while not worrying about making enough money in part-time work to make payments. Another plus to GSLs is, in the past, they sometimes can have portions forgiven or deferred for performing certain services for the government following completion of school.

Today's Rates*:

*subject to change 

Conv. Conforming 30YR Fixed
rate points
6.375 0.000
6.250 0.625
6.125 1.125
Conv. Conforming 15YR Fixed
rate points
6.000 0.000
5.875 0.375
5.750 0.750
5.625 1.125
VA 30YR Fixed
rate points
6.375 -0.125
6.250 0.500
6.125 1.375
6.000 2.375
2nd Mortgages
7.00% - 10 year fixed with low closing costs
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Auto Loans
type rate
New/Used As low as 6.75%
Auto Financing Options
type rate
2007 100% retail for 72 mo.
2005-06 100% retail for 60 mo.
2004 & older 85% retail for 48 mo.
Signature Loans
as low as 9.50%
Tiered Share Rates
amount rate apy
$0-2,499.99 0.50%
$2,500-9,999.99 1.00%
$10,000+ 1.00%
Share Certificate Rates
amount rate apy
$5000-9,999.99 4.75%
$10,000-49,999.99 5.00%
$50,000+ 5.25%
6 month rates .50% lower
Others
type rate apy
Pee-Wee Shares 3.53%
Super Shares 3.82%
IRA 3.82%
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