Educating oneself is imperative if we want to have a better future for ourselves. But alas, there are many students around the world who cannot pursue higher education due to financial problems. To assist these students, many loans for students have been introduced. One such loan is the federal student loans which these students can apply for. This loan can be directly available through student school lenders or Federal Family Education loan Program (FFELP) or through banks. This student loan has helped several underprivileged students to pursue their career goals.
This student loan is very popular among students because they are offered with longer payment periods and also with various kinds of repayment options with easy credit requisites than private loans. The most important plus point of the federal student loans is it offers very low interest rates. They are also available as subsidized loans where the rate of interest is paid by the government to the financial institution in which the student is studying. The interest is paid by the government also during the entire grace period.
Sometime it so happens that the federal student loans may not be sufficient to meet the requirement of the students. During this case, the students can apply for a private loan for students to supplements ones needs. When you apply for this type of loan the students should keep note of the fact that they will not receive the whole amount as certain fees are deducted. This is a very important point to keep in mind when applying for this student loan because if you fail to calculate the loan amount correctly then you may face financial problems in future.
There are several different types of federal student loans available. Hence, choosing the right one which will be suitable for the student may be a difficult task. When applying for this loan, it is advised that you take guidance from other financial aiding sources that will help you to choose the loan which will be best suitable. Mainly these loans are of three types - Stafford loan, PLUS loan and Perkins loan.
Among these three types of loan, Stafford loan is the most common among students as the rate of interest is fixed. It is available to student either in the form of subsidized or unsubsidized student loan. In subsidized form of the loan the government pays the interest when the student is studying and in case of unsubsidized form of loan the student has to pay the interest once he completes his graduation.
The PLUS loans also know as the parent loan is for undergraduate students. This type of federal student loans is given to parents of undergraduate students. For this funds to be granted there are certain requisites. First and foremost, the applicant has to have a flawless credit history in order for the loan to be granted. The rate of interest is fixed but it is a little higher than Stafford loans. The Perkins loan is available for undergraduates and graduate students. This student loan has a fixed interest rate of 5%. Since schools offer these loans to students, the students do not have to wait for the loan to be sanctioned.
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