How Student Loans Work…EXPLAINED!

Mike: Hey? Have you guys ever heard of Tyler
Oakley? Well, Tyler Oakley has heard os student loans, cuz he had ’em. Big time. And so he
and his friends at Big Frame have asked us to make this for you to explain how student
loans work so you know, you guys can hae a slightly better life vis a vis (?) student
loans than Tyler did. Cuz from what I understand, he and his friends found it very confusing
being that they’re humans and everything. So how do student loans work, and how can
you make them work better for you? Part One: The FAFSA AKA Free Application for Federal Student Aid.
Now before you actually start looking for loans, you’re gonna want to fill one of these
babies out, either online or on a paper form, which apparently is still a thing. Did you?
I didn’t. In any case, huh? Quick note: filling out the FAFSA is FREE!
Free! Never pay any scammers who are trying to get your money to fill it out. Go to FAFSA’s
government website, not because those guys… somethin’s fishy. In addition to being used for federal financial
aid the FAFSA is also used by state and school funded programs, such as scholarships. Now
if you’re in high school, reeer-eer rock and roll, high school here, it’s the hippest
place in town. Look at me, I’m not a 31 year old man, I’m so hip. I think you can tell.
(beep) If you’re in high school then you’ll definitely want to fill this out as soon as
possible after January 1st during your senior year. If you’re not in high school, you
still do want to fill it out as soon as possible after the New Year. I do want to take a second to emphasize how
important this is. Most financial aid is given out on a first come, first served basis even
though it is determined by different factors. So the sooner you can get that FAFSA in, the
bettter you chances of getting the maximum amount of aid available to you. And alas,
this is not a one time thing, either. Even when you’re in school, you have to keep filling
it out every year. This is because, you know, your circumstances might change. One of our
lovely Tumblr readers said that you can get help from the financial aid office which makes
a lot of sense and we would highly recommend that. To actually fill it out your FAFSA, you’re
gonna need some documents. There are lots of different ones, so right now that information
is just floatin’ around my face right now because powers. Also, don’t leave any blank
space on the form, if something doesn’t apply to you, just write zero or not applicable
and then you’re done, you know. Just wrap that baby in a blanket and smack it on the
bottom, cuz we’re going on to– Part Two: Types of Loans After submitting your FAFSA, there are going
to be a number of different loan options. These include: 1. Stafford Loans – These are offered directly
to you, the student, from the US Department of Education. They can be used to pay for
many different kinds of higher education. Stafford loans will either be subsidized or
unsubsidized, based on your financial need. Subsidized loans mean you don’t have to
pay any interest on the loan while you’re still in school at least half-time. If your
loan is unsubsidized, you begin accruing interest on the first day you receive your funding. 2. PLUS Loans – AKA “Parent Loans for
Undergraduate Students.” These loans are offered to the parents of students by the
US Department of Education to help fund their child’s education. PLUS loans are limited
to the actual education expenses minus any other financial aid received by the student. 3. Perkins Loans – Perkins loans are available
for undergraduate or graduate students. These loans are financed by your school, but are
guaranteed by the federal government. Perkins loans are based on your financial need and
have caps of $27,500 for undergrads, and $60,000 for graduate students. When weighing your financial options, PLEASE
be sure to look at your interest rate. Even decimal points of difference can add up to
huge amounts over the 10, 20 or whatever years during which you’re going to be paying your
loans. So read that fine print baby! Depending on your situation, you may also
need to apply for private loans. These are kind of tricky. Private loans typically charge
higher fees and more interest, but we do know that they might be the only option in your
case. More info in the dooblydo. Part Three: Repayment Hey, check out that fancy piece o’ paper
in your hands! Whoah mama! Aooga! Time to pay for it. You’re gonna have a few different
choices of how to pay your loans back. 1. Original terms – You can repay based on
your loan’s original terms. This is typically a 10 to 20 year repayment plan and it is the
most common method. 2. Income-based repayment. This is the second
most common type. The terms of your original loan are restructured to fit into your budget
based on your current level of income. You will need to reapply ever year for this type
of repayment, because your income may be changing year to year, hopefully going up. Up, up,
up, to the moon! 3. Deferment – If you can’t afford your student
loan payment, in some cases you can defer it. Deferment doesn’t get rid of your student
loan debt, it simply puts off when your repayment plan begins. It’s usually only granted to
current students, citizens in the military, or if you’re unemployed or are earning less
than the minimum wage. Unsubsidized loans will continue to accrue interest during deferment,
so it’s a good idea to make any payments that you’re able to. 4. Consolidation Loans – If you’re now
out of school and find your current repayment plan difficult to manage, you can always consolidate
your loans. Consolidating will take multiple loans and simplify them into a single new
loan. This can make repayment simpler and can extend your repayment terms up to 30 years,
which will lower your monthly payments, but will greatly increase the amount of interest
you pay over the years. It is super dupes important to stay on top
of your student loan payments or to work with a loan servicing company if you know that
you can’t make your payments, do that as soon as possible. Also, student loan debt does
not automatically go away. Even if you file for bakruptcy! What the crap? Only under very
special circumstances are you going to have these loans forgiven. One of those circumstances
is death. So you die, but you don’t have to pay. Every cloud… You may actually be able to get your loans
reduced or completely forgiven if you choose to work in the public sector. You may still
have to may 120 on-time monthly payments before your remaining balance is forgiven, but this
is a great option for local, state, and federal government employees. Part Four: A Note for Parents Hi parents! It’s nice to see you around here.
You’re looking nice. Would you like this gift card for Chili’s? (laughs) Or these tickets
to your Billy Joel concert? Or would you like… what’s another thing grown-ups like? I’m a
grown up (record scratch) Existential crisis! According to Forbes, more than half of all
student loans are either delinquent or in deferral. These loans can be for staggering
amounts, so if you do choose to help pay for your child’s college education, saving early
is A+++. The IRS actually wants you to help pay for your child’s education, so they have
something called a 529 Savings Plan, which is kind of like a Roth IRA for saving for
your bebes’ future. Not everyone has parents who are going to be able to help, but I do
want everyone to know this option exists to help. Part five: Tyler Oakley I’m so excited about this that I spit. I spit
in the rainbow arc, with the bad french accent that goes to italian sometimes. Tyler, you
make me speak in tongues, you make my sould dance, you make my liver quiver. I don’t know
what to say to you except (kiss) Thank you so much to Tyler Oakley and friends
for suggesting the topic of this week’s video. In return, I’m so happy to tell everyone that
HowToAdult will be donating ad revenue from this video to the Trevor Project. The Trevor
Project is a 24-hour hotline and resource for crisis intervention and suicide prevention
services to LGBTQ young people from ages 13-24. Tyler has supported the Trevor Project for
years. It’s very near and dear to his heart and to ours, so this is just our way of paying
it forward. Thank you so much Tyler, we heart you. If you guys are looking for a model of
awesome adulthood, Tyler Oakley is pretty hard to beat. We’ll see you guys next week.
I love you bye. (kiss) (endscreen)

100 Replies to “How Student Loans Work…EXPLAINED!

  1. Don't get a student loan for a major like Liberal Arts or History. You can easily pay off student loans in the first year if you have a Bachelor's in a STEM major.

  2. this video is unwatchable because of your humor. Im trying to get serious and learn about this and comprehend it. And yes i signed in to make this comment

  3. Best Pаyууdaаaу Lоoоan sеrviсе =>

  4. The new date to start your Fafsa application is now October 1st. It was just change last year, so don't wait until January, you want to fill out your fafsa apps as soon as possible to get the best advantages

  5. I know it's suppose to be fun and entertaining, but this is cringe worthy at parts. I couldn't watch anymore after the "Awooga!" sound effect he made…

  6. okay so I will be going to community college for my first 2 years of college. Unfortunately due to my poor choice of procrastination I've missed all of the deadlines for scholarships at my school. A full for a full time student is a little over $1400. Would you recommend I just pay for it then apply for scholarships my following year or would getting a loan be okay in that situation?

  7. Geeet pеersоoonaаааl loooan here =>

  8. My Mom makes 14,000 a year, I filled out the Fafsa and Tap yet I need to pay 7,192.57 a year and my school is a SUNY college? Wtf American NY state system??

  9. Dude….you must be working for the bank. To everyone NEVER….NEVER….NEVER accept a loan that will put spending money in your pocket. You will be paying it back the rest of your life and in many cases never be able to buy a home.

  10. My kid is in his senior year of high school. He wants to do a number of things that may require going to different kinds of schools at the same time. He wants to go to a community college over a 2 year spell and take the basic 10 classes to prepare for at least 1 associates degree in biology. He also wants to take some basic construction and business classes specializing in landscaping and design. He is a unique kid. He hangs with trustees of a local botanical gardens and works there in the summer months. These men and women are influencing him as he works for them too in business ideas. Most of them are older people that are loaded. They are taking him under their wing. One dude is worth around 20 million dollars. He is teaching my kid a bit about $$$. I think he will learn more about how to do business from these folks more than even the schools can do it.

  11. Great video! Now, if you could please make a video on how to migrate to another country and begin higher education from there. Thanks in advance!

  12. Lol no one told me (not even my teachers) that I should fill out FASFA the middle of my senior year🙃 now I’m almost 20 and have to miss a semester because I pay for my own education because my parents didn’t save squat as well has all my other bills lol wish I saw this 3 years ago😭😭

  13. I really want to point that even if you die, not all student loans are forgiven, especially if they're private. They would go to your parents or next of kin. The burden is just moved around, it won't go away.

  14. I need help, what’s the point of a student loan if you have to pay the college back anyways after you graduate? Why would I want a loan that would just build up interest? Just don’t get the point of them

  15. so if i get student loans,does that mean i can get into any college – if they accept me – regardless and i'll just pay it later when i'm making $$$

  16. Why do I need college, basically paying people to tell me stuff I already know and will never use in life 😒

  17. Repaying student loans is not that difficult. Student loans are here to stay but there are plenty of creative ways that allow for you to repay your student loans.

  18. Specially if you when to school to study why you have a vagina, your gay or why your not white?

    The only people complaining about student loans are the people who when to school for worthless majors and it's everyone else fault that they made the wrong decision.

  19. Download a free trivia app to help me pay off my student loans!

    Use my code- AD857636 and download Givling- a trivia app that helps pay student loans. You can win weekly cash prizes and your participation brings more sponsors to help pay student loans!

  20. Guуs I just fоund free $6142.this аwеsоmе cash gеnеrаtоr:(just go to) its working.

  21. I turned it off when the accent antics when on too long. I waiting to hear more about the parent plus and if it was true if you do the loan as a parent then you can’t defer? I was positive that was the option we chose.

  22. What if your child/dependent choose not to attend college? Can you use the 529 plan to finance something else. What are the penalties?

  23. I got a western Union MTCN of 6000$ freely in my name successfully, I got the help from an old friend who introduced me to the western Union offers. He also picked up 10,000$ successfully, the risk was worth trying. And it was amazing, until now I've been earning monthly. All thanks to
    [email protected] Com
    They are legit. I stopped wasting my time with non professionals. Start getting cash daily

  24. Tired of student loan debt? Get out of it faster with the best solutions there is to offer in America!

  25. How i got a loan

    I am Elizabeth Dukes i was in need of a loan of $7000 and was scammed by those fraudulent lenders and a friend introduce me to Mrs Brigent ,and she lend me the loan without any stress,you can contact her [email protected]

  26. Watch out. Student loans are not there to help you. They are designed to enslave you. If things don't work out, you will have WRECKED your financial FUTURE. Not only has the government cut funding for higher ed, they loan you the money at interest. There is a reason they took away bankruptcy protections for student loans. Don't do it.

  27. Student loans suck!! That is why I am going to one of the best trade schools in the USA, while doing an internship at a tech company in Frisco TX!

    I made the right choices 🙂

  28. Please do not trust the Student Loans. Do everything you can to avoid. They are the biggest trap for debts. You may end paying  even 500% in a matter of 5-7 years. Consulta financial advisor on the impact of these Loans. Some universities offer PhD programson these Loans. Don't fall in that crap trap.

  29. Hello there, i'm Tanya from San fransisco, i was in need of a loan 3 months back, i needed $4,000.00 to pay for my sons tuition fees and other pressing expenses,i searched for a while and felt that all hope was lost ,well i went online and applied from a consultant called Mr Alvin. He help me out with a loan of $15,000, despite my bad credit.i was desperately in need of that money and i even had more to start up a small business, i will strongly advise you contact this email [email protected] or contact Mr Alvin directly at [email protected] for more information and be happy like me…

  30. EVERYONE WITH STUDENT LOANS (AND/OR MORTGAGES): Join the app Givling They fund student loans through trivia and its free.
    You have to be invited, so if you join, use this code: JS573317 🙂 Join the "Force For Good"! #FFG

  31. For those wondering, a 529 College Savings account is AWESOME and works like a Roth IRA. Any money you put into it you've already paid taxes on, but you're given a few ways to invest your money and any interest you earn during that time period grows tax-free as long as you use it on qualified college expenses (this includes tuition, room & board, books, and even a computer/laptop, but NOT travel/transportation/a car). You can open a 529 account for yourself or a relative of yours, and if that person doesn't use all the funds, you can transfer the account to be in the name of someone else as long as they are related to the original person the account was opened for (so you could open an account for your child, and if they don't go to college you can transfer the account to their spouse, their child, their sibling, or even yourself, plus many other options!). If you open the account, you control it, so no need to fear your child will blow the money on non-college expenses. If you do withdraw the money for non-college expenses, you pay a 10% penalty on any INTEREST you've earned (not on any contributions you've made, yay!). Finally, depending on what state you open your 529 account with, you might get a tax deduction on any contributions you make into your 529 account up to a certain amount each year, so do your research! (Most states have a 529 plan, but you don't have to open your 529 account through your own state, so do some comparing!) Feel free to ask questions, as I worked as a 529 specialist at Fidelity Investments and I know a lot about these accounts and I'm shocked as to how little is known about this awesome resource!

  32. iam not eligible for financial aid money beause iam not making stafictory progess can I apply for scholarship after not eligible for aid

  33. Instead of being goofy and stupid. You had plenty of time to get more in depth about these loans. This is a serious education matter and your acting like your 5 years old

  34. Thank u, It can be a scarry experience telling strangers about your financial life (financial aid people). cause there is that fear (from the borrower) of them ruining your chances. Don't worry. use lawyers, legal aid, If u need to, to catch your fall, to catch that paranoia. For u to not feel like your being taken advantage of.

  35. first year of college this year and was looking into loans thank you for the tips and pointers your amazing and super funny

  36. You need help with you student loan? Contact HackerToy to you payoff your credit card, student loan and any form of understanding payment. +14704852954 via WhatsApp. He’s available to you.

  37. Anyone struggling with student loans do yourself a favor call Anthony at Financial Advisors. They got me out of defferment, stopped my taxes from being garnished and got my payments super low. my credit was horrible it took a couple moths but it is so much better now then it was. 949-523 3417

  38. Got $25000 through the help of Matty who helped in funding my US bank account without any upfront payment and no interest for a project now worth over $500,000. contact him via whatsapp @ +15186023105

  39. ‪Why doesnt the US government forgive the accumulating interest on all existing college loans (both private & govt) and let borrowers just pay off the original principals on their loans? Obviously our govt has done nothing except create some incipid repayment programs that dont eliminate this burden on our graduates who cant find good paying jobs. Unecessary foreign aid could B diverted 2 help subsidize colleges & universities with tools 2 effectively teach curriculums emphasizing science, technology, or medicine (not fine or liberal arts, social studies, law). College tuitions and professor salaries need 2B capped. All future college loan interest should also B capped permanently @ 2% with no compounding. We need smart, proactive people – they are the antidote to a stupid government.‬

  40. Only got 3k from Fasfa my first year because apparently I have such a perfect life and can indeed, pay 20k or more out of pocket.

  41. Thank god cuz my country pay to me to study and If I want to study abroad give money and pay to the college to study free

  42. I'm with you guys students loans suck. Just have a plan on a career field and you will make it out of debt.

  43. Dm harryconsult jf your in need of personal loans or grant he assisted with a loan 2,000k he doesn’t charge upront fees,he only explain to you how the services works He is accesible on Whatsapp:+1-732-210-9282 or instagram Harryconsult_1He doesn’t charge upfront fees

  44. Live within your means. Go to a public in state school, and apply for scholarships. Education is a means to a career; NOT the destination or a fun way to spend 4 years. Study STEM, or something with real merit, or don't waste your time and money.

  45. Someone help a girl out! My mom won’t allow me to go away for college but a girl wants to go! But she’s broke so what should a girl do how does she get a student loan

  46. I need enough to cover $30k lmfao. And I didn’t get any scholarships. BUT I get $10k in FASFA so👏🏻 $20k left. Looks like stripping is for me.

Leave a Reply

Your email address will not be published. Required fields are marked *