FiCEP Student Loan Counseling 3

Question 1

To qualify for Public Service Loan Forgiveness (PSLF), a borrower must make how many qualifying monthly payments while working full-time for an eligible employer?

Accepted Answer

120 payments

Answer

PSLF requires 120 qualifying payments (equivalent to 10 years) on an eligible repayment plan while employed full-time by a qualifying public service or non-profit organization.

Question 2

After how many days of non-payment are federal student loans considered to be in default?

Accepted Answer

270 days

Answer

Federal Direct Loans enter default after 270 days (approximately 9 months) of non-payment, at which point the full loan balance becomes immediately due.

Question 3

Which of the following is an immediate consequence when a federal student loan enters default?

Accepted Answer

The entire outstanding loan balance becomes immediately due and payable

Answer

Upon default, the Department of Education can demand the full loan balance immediately (acceleration), and may pursue wage garnishment, tax refund offset, and Social Security benefit offset.

Question 4

The Teacher Loan Forgiveness program offers eligible teachers up to how much in federal loan forgiveness after teaching for five consecutive years in a low-income school?

Accepted Answer

Up to $17,500

Answer

Highly qualified math, science, and special education teachers at low-income schools can receive up to $17,500 in Teacher Loan Forgiveness; most other eligible teachers receive up to $5,000.

Question 5

What is federal student loan 'rehabilitation,' and how is it typically completed?

Accepted Answer

Making 9 voluntary, reasonable, and affordable monthly payments within 10 consecutive months

Answer

Rehabilitation requires making 9 voluntary, on-time monthly payments within 10 consecutive months; upon completion, the default notation is removed from credit reports and collection fees may be reduced.

FiCEP - Financial Counseling Certification Program Practice Test

FiCEP - Financial Counseling Certification Program Practice Test

FiCEP Student Loan Counseling 3