how long does it take to get approved for the stafford loan?

[BoxingTheStars]

Just wondering, since I didn't think there was any factors which would make someone ineligible. But it's been a couple days and I still haven't heard anything.

---

Members don't see this ad.

 

[Doctor Bagel]

Did you check the lender's website? They won't send you any official notice. Normally you tell your school which lender you want, and the school tells the lender, so that could take a while depending on how efficient either your lender or your school are.

 

[BoxingTheStars]

Did you check the lender's website? They won't send you any official notice. Normally you tell your school which lender you want, and the school tells the lender, so that could take a while depending on how efficient either your lender or your school are.

I called them, I guess I needed to sign the master promissory note first (don't know why they didn't instruct me to do this when I applied...)

I'm actually reconsidering this lender now due to the person I just talked to on the phone. She kept rushing me to sign it electronically WITHOUT READING IT FIRST (come on, it's my first time taking out loans!) saying the system would "time out" etc and when I asked if I could print it out she tried to tell me I was "too far along" to change my mind (complete lie, I did it). I kept telling her I could handle it from here but she kept making excuses to stay on the phone to make sure I could get it submitted.

And then she asked me if I would need more money than the stafford, presumably to "sell me" a grad plus loan/alt loan... and tried to tell me I couldn't get more than 20K or whatever the ugrad limit is, even though I kept telling her I was a med student and my award letter says I can get 42K...

very shady + unknowledgeable = I'm DEFINITELY taking a closer look at this...

EDIT: ok I'm done ranting, but where can I get the lender's terms in writing? (specifically: no origination or default fees)
... I don't see it on the MPN, which looks rather generic. I'm so confused

 

[TMP-SMX]

Usually the latest terms are on the lender's website. Of course they can change it anytime that they want.

By the way, which lender were you on the phone with?

 

[BoxingTheStars]

Usually the latest terms are on the lender's website. Of course they can change it anytime that they want.

By the way, which lender were you on the phone with?

this was Wells Fargo.

So there's no way to get the "no origination or default fees" in writing first? That sucks.

 

[mano82]

I got the preapproval letter in which it is stated tht a loan fee in the amount of 0.00% of each disbursement will be added to your principal amount of ur loan at disbursement . What i understand is tht there will be no loan fee wht do u think.?
In their website it is written tht no origination,guarantee or repayment fees but as such nothing like it mentioned in MPN or preapproval letter.

 

[AMDFAO]

As there is no credit check with a Stafford, the approval is based on other things which you should easily be able to say "done that."
You need to be a US citizen or perm resident
You need to complete the FAFSA and sign it and send the school any documents it asked for
You need to be registered for Selective Services if you are a guy
You can't owe the feds money on a grant or be in default of another fed loan
Show up and enroll at the school
Finally: don't get convicted for a drug offense

You will not get an approval letter for a Stafford (like you would a car loan). Essentially you do the basics and sign a loan note and then the school certifies you are there and the amount and the lender sends the money.
I would also add that even if you signed the loan note and even if the money was sent (disbursed) to the school you still have the right to cancel it off within a period of time after (I think it's 30 days but check on that since haven't had a student cancel a loan themelves in ages BUT if the FA Office cancels it it generally can occur outside the 30 days). In short: if you ever want to cancel a Stafford, go to the FA Office. Follow up with the lender to make sure the piece was cancelled-- you do that, not the FA person. If you sign an MPN (master prom note) you have the right to go with a new lender should you choose EVEN IF YOU SIGNED IT. It does not become a loan until the money is sent to the school. Private (non-fed backed) loans have the right to make their own rules so buyer beware.
Anyway, I will add another tragic tale from my side of the desk to further my point about cancelling: I inherited a dental kid from another school who borrowed at his old school. When we met to go over all his debt (not just what he took while at my school but all of it since I'm a full service girl) he realized that a $5000 loan was never cancelled by his FA person in his first year even though he asked it to be because he received a $5000 scholarship. Fast forward 7 years later... When I asked him if he ever received a check for $5000 from the school he said "yes". In short, the loan was never cancelled and the extra $5000 floating around went to the kid. He said "but I asked them to cancel it" and I said "honey, that was 7 years ago... you should have asked when you got the unexpected $5000 so it is yours to pay back". All told, the amount had grown to close to $9000. Lesson for you all: follow up is key and keeping track of your money is your job too. I'm only one girl and very upfront with my kids and don't have any issues-- they also appreciate my direct (but funny) style.
As for the MPN and the clear lack of disclosure in regards to fees etc. The loans are dictated by the Gov't so the language is pretty basic from lender to lender. The loan fees charged are voted in to law as are your rights and responsibilities. Lenders attempt to differentiate themselves by offering incentives (these are not overseen by fed law). The incentives are at the lenders descretion which is really a nice way of saying: "when our profit margin is cut, we'll find a way to make it back." I'm not sure why folks from my side of the desk can't just explain this stuff but for the most part, they can't. It is unlikely that the MPN would contain incentive language.
Hopefully that clarified it a bit but if not, post back and I'll do my best to clarify.

 

[Segolene]

The incentives are at the lenders descretion which is really a nice way of saying: "when our profit margin is cut, we'll find a way to make it back." I'm not sure why folks from my side of the desk can't just explain this stuff but for the most part, they can't. It is unlikely that the MPN would contain incentive language.

Two questions:

1. Is there a way to get the incentives reduced to writing for the student (e.g., letter of disclosure) so the student has some legal paper to rely upon at a future date should there be a disagreement about the incentives?

2. When a lender sells the note to another financial institution, what happens to the incentives? Is the student at the mercy of the new lender?

AMFAO, would much appreciate your thoughts on this.

 

[AMDFAO]

Perhaps. You do receive a disclosure statement outlining the amount and estimated payments but usually they would not include the benefit since you haven't earned it. Even then, I am certain if you hunted long enough you would find the "outclause" on any of them. If the loan is sold: the new lender may honor the old lenders agreement if it was "iron clad," if not, they would discontinue it. I can guarantee you that if you consolidated it later, you would lose the incentive whether the same lender was the new owner or it went to another party. Incentives can be on the interest rate or the fact the lender covered the fees for you. If you did get it in writing, keep in mind that it would not cover all your loans but maybe just that years-- next year is a whole new ballgame. Do you find a second lender? A third? And then another?
Again, the devil is in the details and the one most of you overlook is stabilty and ease of use.

 

[nhy201]

Perhaps. You do receive a disclosure statement outlining the amount and estimated payments but usually they would not include the benefit since you haven't earned it. Even then, I am certain if you hunted long enough you would find the "outclause" on any of them. If the loan is sold: the new lender may honor the old lenders agreement if it was "iron clad," if not, they would discontinue it. I can guarantee you that if you consolidated it later, you would lose the incentive whether the same lender was the new owner or it went to another party. Incentives can be on the interest rate or the fact the lender covered the fees for you. If you did get it in writing, keep in mind that it would not cover all your loans but maybe just that years-- next year is a whole new ballgame. Do you find a second lender? A third? And then another?
Again, the devil is in the details and the one most of you overlook is stability and ease of use.

AMDFAO, someone told me about this new program from Chase. Its interest rate is 5.8% instead of 6.8% with is what most other lenders have.
http://www.chasestudentloans.com/medical/index.htm
Benefits: Stafford

• No borrower-paid origination or default fees
• 5.80% interest rate at repayment and for the remainder of the loan term
• Accrued interest capitalized only after uninterrupted periods of grace and deferment
• Standard level repayment or interest-only for the first two years and level repayment thereafter

Interest rate reduction:

• 1.0% reduction at repayment

Is this too good to be true? In your experience did you have any trouble with Chase? Is Chase easy to use, stable and have good customer service? I am 2 steps away from choosing chase as my lender for next school year. My second choice is Bank of America. My third choice is Edamerica. Does anybody know if the last 2 lenders are easy to use with good customer service? Does anybody have problems with them in the past? I would really appreciate any input. I just want to choose a lender and get this headache over with (at least for this year).