College is a great experience for those who go. Unfortunately, many people are unable to afford college out of pocket and don’t have access to certain scholarships due to many different reasons.
However, there is one more option that you can consider which is student loans. There are several types of student loans that you might be able to receive.
When considering the best student loans for your situation, it would be a good idea to take a look at all the options on the table for you and your family. Here is a guide to the different student loan options you can use to pay for college.
Federal Student Loans
Otherwise known as Stafford Loans, these are loans that are paid to the school by the Federal government.
They are usually recommended because of their overall lower interest rates than private loans as well as the fact that you do not need to repay them until after you graduate.
Under the CARES Act of 2021, the interest rates for federal loans were frozen at zero percent at least until September 2021 due to the pandemic.
Federal loans have both direct subsidized loans and direct unsubsidized loans as well as Parent loans, known as the Parent PLUS Loan.
As an undergraduate, the amount you can receive for a federal subsidized loan varies based on your year in school.
Unsubsidized loans are roughly the same, and can also depend on whether or not you are claimed as a dependent. If you are considered independent, you can receive a larger loan.
Private Loans should be a last resort when trying to find a way to get into college. Private loans do often help you pay the difference of your university.
Private loans can be both helpful and harmful to you depending on a few factors. They are available to both graduate and undergraduate students, but they require a credit check.
You can have a cosigner to alleviate the credit check barrier. Private loans can be used to supplement your federal loans. The catch is that private student loans are subject to who is extending the loans.
Unlike government loans, they do not all have fixed interest rates, so your interest rates can fluctuate according to various factors. One of the many pros and cons of paying student loans early is that some loans will cost you less over time than federal loans. All you have to do is know where to look.
Some private loans also allow you the opportunity of consolidating student loans. This comes in handy when someone has borrowed from multiple lenders and needs to better manage their payments.
The Different Types of Student Loans
Most people aren’t very aware of the many types of student loans that are at their disposal. Paying for college can seem like a monumental task especially when you don’t have the funds.
Don’t let finances stop you from getting your higher education. Explore your financial aid options today. Be sure to visit our blog for more information concerning your ways to get to and succeed in college.