Types Of Student Loans

If you think that all student loans are the same, think again. The fact of the matter is that even though all student loans help you to pay for college, there are many different types that you can take out. For this reason, before you fill out any student loan applications you will want to learn as much as you can about all of your available options. You may find out soon enough that some types of student loans are best for you, and others do not meet your needs at all.

Federal Stafford Loans

These student loans are granted based on financial need which means that not every student will be eligible to receive one of these. These student loans can be obtained from an institution like a bank or credit union, and there are three types of Federal Stafford Loans that you should be aware of. They include subsidized Federal Stafford Loans which offer long term loans with low interest rates; unsubsidized that offer long terms, low rates, and are not need based; and additional unsubsidized Stafford loans which are for students deemed as independent.

Federal Plus Loans

These loans can be secured by parents who have children attending college. Generally speaking, these student loans are based on cost of attending college as well as credit history. Interest is usually low, but repayment starts two to three months upon receiving the funds.

Federal Perkins Loans

These student loans are awarded to students who are in desperate need for financial assistance. They usually have very low interest rates; lower than the others listed above. Since the total funds available for these loans are low, the amount that a student can possibly secure is also quite low.

Private Lenders

The options listed above are federal loans, and some students may not qualify for any of them. If you fall into this category you will want to look into getting a student loan from a private lender. Loan companies and banks often times offer these to students at low interest rates.

As you can see, there are many different types of student loans that you can look into. So if you need money for college there is no reason to fret. Simply check all of your available options, and in no time at all you will have the opportunity to secure a student loan.