Student Loans
Find the best student loan for you
Are you going to be attending college or taking online courses in the near future? If you are, then you may well have to take out student loans. Most students end up taking out multiple loans over the course of their study periods, so you need to understand what the process involves before you apply for your first one.
Applying for student loans can be a complex process; to get started, you need to know about the different types of student loans that are available. There common types of student loans include:
- Federal Stafford loans
- Subsidized federal Stafford loans
- Unsubsidized federal Stafford loans
- Federal PLUS loans
- Federal Perkins loans
- Private student loans
- International student loans
Federal Stafford loans are the most common college student loans that are taken out. They have low fixed interest rates, and the money can be used both for tuition and other school-related expenses. You may use the funds for both traditional in-class programs as well as accredited online degrees.
Subsidized federal Stafford loans are student loans that the federal government issues to borrowers. The government pays the interest charges that accrue while you are in school. When you enter the repayment period, you will need to pay back both the money that was borrowed and the interest that built up while you were in school. This type of loan is based on financial need, so your household income level will determine how much money you can borrow.
Unsubsidized student loans require the borrowers to pay the interest that accrues on the loan while they are still in school. However, the advantage of an unsubsidized loan is that you can borrow more money than you’d be able to if you only had access to a subsidized loan.
The Federal Perkins loans are great student loans for college students because the government pays the interest as long as you are attending classes. These are one of the best college student loans to get. They cater to lower-income and needy families who need a lot of help paying for college.
Federal PLUS loans can only be given to parents and guardians of college-age students. The college student is not responsible for any of the balance that is owed.
Private student loans should only be sought if you cannot get any additional forms of financial aid to cover your college expenses. If you do not have an income, then you will need a co-signer, usually a parent or a grandparent.
International student loans are available to American college students who are going to study abroad, and to international students who come to the U.S. to study. While you’ll have to research lenders that specialize in this type of student loan, the interest rates are usually competitive.
Repaying a student loan generally begins six months after you complete your college program. You need to make your monthly loan payments on time, because you cannot file for bankruptcy to discharge the debt. If you are struggling to repay your college student loans, then you need to contact your lender immediately. You can consolidate your student loans, speak to a representative about reducing your monthly payments or apply for forbearance. Your financial situation will be assessed, and a plan will then be created to ensure that you do not default on your federal student loans.
When you consolidate student loans, you combine all of your outstanding loans and extend the repayment period to its maximum. This reduces the overall amount of your monthly payment, which can be very beneficial.
You can refinance student loans; this also helps you reduce your monthly loan payments. You can refinance both your federal and private student loans in order to save money on interest. You do, however, need to have a good credit score in order to refinance.
Forbearance is available to people experiencing a financial hardship, such as the loss of a job, the death of a spouse or family member, or a debilitating illness. It allows you to reduce the amount of your monthly payments, temporarily stop making your loan payments or extend the time period of your repayment plan.
Having a student loan is a big responsibility; you need to find the type of loan that is right for you and your finances. If you have any doubts, then you should speak to a financial aid representative at your college. They can help you navigate your way through the entire process.
