College Loan Student
Getting a College Loan: a Student's Guide.
While it may be tougher to get a college loan for students than it has been in the past, it is certainly still possible to get financial aid toward a degree. Since college tuitions have increased drastically in recent years, student college loans are a must for many people to attain a degree, but only by understanding the nature of college loans can students ensure that they are receiving loans at the best rates which they will be able to repay. Before applying for loans, you will need to fill out a FAFSA form, which can be submitted online. Some loans like the Perkins loan will be applied for automatically when you submit your FAFSA.
College loans for students which are always available are federal loans, notably the Stafford loan. While Congress limits the interest charged on these loans, most lenders will charge as much interest as allowed on these. For Stafford loans this rate is 6.8%, and for Perkins loans, meant for lower-income students, 5% is the maximum allowed. There is also a limit on the amount a student can borrow through these loans per year, meaning that a student without a large range of outside financial resources may want to consider grants or scholarships in order to avoid having to borrow from another lender. These loans can be subsidized, meaning that the government will pay the interest while you are in school, or unsubsidized, meaning you are responsible for interest accumulated while in school. Payments on these loans begin 6 months (or 9 months for Perkins loans) after you graduate, and must be repaid within 10 years.
You can apply for loans by applying online, at http://www.staffordloan.com/, or at your school’s financial aid office. Only by talking with representatives of various lenders can one truly know how to go about getting the best deals on college student loans. As mentioned, most lenders will charge the maximum interest, but there are certain special offers that some lenders will make. For example, certain reductions in interest or repayment amount might be made for a student who makes payments on-time for 3 years. However, many of these college loan student targets specified by the lender are difficult to meet, so students should not automatically assume that they will qualify for these special deals.
Private student school loans through banks are also an option, but care must be taken when shopping around for these, and they should only be used if absolutely necessary and if the student is sure they will be able to repay them. College loans for students through private lenders always have higher interest rates than federal loans, although this rate varies from bank to bank. Terms and conditions for private loans will vary as well, but generally must be repaid within 15-25 years after graduation. Finaid.org has more information on several private loans which have been rated well according to how they calculate interest and length of time for repayment.
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