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APTA Endorsed Education Loan Program

Consolidation Loan Program

APTA Endorsed
APTA has carefully selected Education Association Services (EAS) Group, LLC and American Student Loan Consolidation Corporation (ASLCC) as the exclusive provider for the APTA Endorsed Education Consolidation Loan Program

EAS Group, LLC


Education Association Services (EAS) Group, LLC is dedicated to Making Paying for Higher Education and Beyond Understandable and Affordable. EAS provides endorsed value propositioned education financing products and services specifically developed to compliment and assist association members, higher education institutions, students and families achieve their goals.

ASLCC
American Student Loan Consolidation Corporation (ASLCC) is the nation's preeminent company specializing in Education Consolidation Loans. Working with the country's largest guarantors and lenders, ASLCC staff and management are thoroughly trained to ensure that former borrowers make informed decisions and obtain the best plan for their needs.

Background
EAS and ASLCC have helped thousands of former student and parent borrowers save money on their education loans while making the process of repayment easier. EAS and ASLCC has consolidated over $100 million in student loans and is the exclusive loan consolidation source for over 20 professional association, colleges and universities and organizations.

Why Are Consolidation Loans Important?


Student indebtedness levels are increasing
along with the cost of education

Coupled with a reluctant economy and job


stagnation education debt with traditional 10-year repayment terms are rendering college graduates financially impaired.

Interest rates on Federal Stafford Loans are


decreasing thus creating an affordable manageable money management solution

Consolidation Loans are an attractive option to


lock in the lowest ever interest rates effective July 1, 2003

What Is a Federal Consolidation Loan?


A Federal Consolidation Loan combines two or more existing student loans into a new loan with a lower payment and an extended repayment period.

Which Loans Are Eligible for Consolidation?


FFELP loans (Stafford, PLUS, SLS)

Direct loans (Stafford, PLUS)


FDLP loans (Stafford, PLUS) Perkins Loans FISL loans Health Education Assistance Loans (HEAL) Health Professional Student Loans (HPSL) Nursing School Loans (NSL)
If a borrower is unsure of their loan history, all they need to do is contact our Consolidation Loan Counselors and they will access this information for them, confirm their eligibility, and answer all questions so an informed decision can be made.

*Notealternative loans are not eligible for consolidation

Sample Repayment Terms


Total Student Loan Debt $ 7,500 - $ 9,999 $10,000 - $19,999 $20,000 - $39,999 $40,000 - $59,999 $60,000 or more

Maximum Term
12 years 15 years 20 years 25 years 30 years

How Is The Interest Rate Calculated?


*Calculate the weighted average of the interest rates of the loans consolidated and then round up to the nearest 1/8 of 1.00%

*Interest Rate Cap of 8.25%

What Is A Weighted Average and How Is It Determined???


Example: Outstanding loan balances of $3500 (7%) $3200 (5%) $5500 (9%) = $12,200 Step 1 Multiply the outstanding balance of each loan by the interest rate: $3500 x .07 = $245 $3200 x .05 = $160 $5500 x .09 = $495

Example
Example: Outstanding loan balances of $3500 (7%) $3200 (5%) $5500 (9%) = $12,200

Step 2
Add the results of all calculations made under Step 1 $245 + $160 + $495 = $900 Divide this sum by the total outstanding balance $900 $12200 = .07377 or 7.377%

Example
Example: Outstanding loan balances of $3500 (7%) $3200 (5%) $5500 (9%) = $12,200 Step 2 Round the result of Step 2 up to the nearest eighth of one percent, not to exceed 8.25% 7.377% is rounded up to 7.5%

Repayment Options
Repayment Options

Level: Fixed monthly payment over the life of the loan.

Graduated: Monthly payments start low and gradually increase at specified levels.

Repayment Options
Loan Amount Current Level Graduated Months Payments (1st Two Years)

$20,000
$40,000 $60,000 $80,000

$198

$116

$60
$119 $179 $238

240
300 360 360

$396 $201 $594 $207 $792 $360

$100,000

$989 $450

$289

350

Key Questions Borrowers Should Ask Why should I consolidate?

When should I consolidate? Who can consolidate? How do I apply?

Why Should I Consolidate?


Reduce monthly payment by as much as 50%
or more Simplify student loan repayment by replacing variable federal education loans with a single fixed interest rate loan with a single monthly payment. Fixed interest rates from approximately 2.875 to 4.25% for the life of the loan (if you have not previously consolidated any of your loans) No fees or charges to consolidate No credit check or income verification No prepayment penalty

When Should You Consolidate?


When in grace period or in repayment. When interest rates are low. Borrowers submitting a consolidation application during their grace period, the interest rate of the Consolidation Loan will be based on the relatively lower grace period interest rate reported by the loan holder.

Who Should Consolidate?


Borrowers who are having trouble making payments Borrowers who have irregular monthly incomes Borrowers who need to allocate funds to other worthy expenses such as child care expenses Borrowers who need to pay off higher interest rate consumer debt Borrowers who wish to begin a savings plan for a home, car, retirement or family assistance.

Who Should Consolidate?


Borrowers whose education loan payments exceed 8 - 10% of their gross monthly income. Annual Income $ 30,000 $ 50,000 $ 75,000 $100,000 Monthly Income $2,500 $4,167 $6,250 $8,333 Maximum Student Loan Payment 8% 10% $200 $250 $333 $417 $500 $625 $667 $833

Summary:
The Advantages of Consolidation
Extended repayment period Lower monthly payments No fee to consolidate No penalty for prepayment Locked-in interest rate Eligible for death claim

Applying for Consolidation:


The Single Lender Rule
Regulation 682.102(d) states that a borrower who has all of their loans with a single holder must seek consolidation from that holder. If the holder declines to make a consolidation loan, or refuses to offer a loan with income-sensitive repayment, the borrower may seek consolidation elsewhere.

Applying for Consolidation:


Completing the Application
Be informed. Consult with one of our professional Counselors first! The APTA Consolidation Loan applications are available online, in paper format, and over the phone. Once the lender receives the completed application, the lender contacts any and all holder of the loans. After the lender reviews the loans, the borrower verifies and approves the loan. The loan is then funded.

Applying for Consolidation:


A Timeline
Consolidation typically takes 4 - 8 weeks to complete. The repayment period usually begins 30 days after the loan is disbursed. First payment is usually due within 60 days of disbursement. Borrowers must continue to make payments on all loans being consolidated.

Repayment Tips:

Borrowers can prepay at any time


without penalty. Interest is deductible, but tax rules are complex consult a tax professional. You can also go to: http://ftp.fedworld.gov/pub/irspdf/p970.pdf (this site is also complex).

Repayment Tips:

Deferment and forbearance


options are available - the borrower should call if they have trouble making payments The loan is discharged if the borrower becomes completely and permanently disabled or dies

What If a Borrower Defaults?


The borrower could incur collection
costs and legal expenses The borrowers credit history will be tarnished The borrowers wages will be garnished The borrowers federal tax refund will be withheld The borrower may be subject to stateimposed penalties or restrictions.

How to Apply for an APTA Endorsed Consolidation Loan?


Call ASLCC consolidation counseling center toll-free number at 800-741- 4704 Monday through Friday 8 A.M. 9 p.M. EST and Saturday 10 A.M. 5 p.M. EST Be sure to reference APTA. Log on to our website at http://easnetwork.Com/asso/apta/