Students who cannot afford higher education often have to dream of going to college. Not having the necessary resources to fund your continuing education is very unfortunate. However, some people can simply write a check for their college expenses and get it done. It is true that the cost of learning is much higher than in previous years. Nonetheless, you can choose from certain student loans that are designed to be used for education beyond high school. These are often referred to as federal or government student loans. Initially, though, you must show the government that you do need financial support.
As the term implies, federal student loans are funds from the government, so these loans cost less than any bank’s private loans. Additionally, grace periods or payment deferrals may be granted while students continue their studies. There are basically four types of government loans: PLUS, Consolidation, Unsubsidized and Subsidized Stafford.
PLUS loans are awarded to eligible parents of students who are not considered independent or fall into the minority dependent category. Independent students are those students who are married, over the age of 24, professional graduates, or legally dependent on a spouse other than their spouse. Additionally, PLUS loans allow parents to borrow money on behalf of undergraduate students.
Alternative loans, or others known as non-federal or non-government student loans, are additional funding options for students who wish to borrow money for their education. Unlike federal student loans, this loan type is not a secured loan. It is also important to understand that non-federal loans use the credit of the lender and their credit rating as the basis for loan financing.
Each year, prospective students should complete and submit the Free Application for the FAFSA or Federal Student Aid Application and submit it to the college’s financial aid area. The amount borrowed may vary, but generally students will not need any additional borrowed funds.
Every student should monitor and find out all relevant loan forms to determine what the actual loan amount is and where it will ultimately come from as they continue their education.
This FAFSA app assesses the ability of students and their families to fund their education; costs and all relevant important information such as taxes, income, assets, school aid, and more. You can obtain these FAFSA applications at any financial aid office, college guidance office, and some online sites.
Government loans can help any student, regardless of their financial level. As students approach or are about to graduate, it is necessary to complete the exit interview process. University financial aid officers will review all loans received by the student, expected payment amounts, and the student’s various rights and responsibilities as a borrower.
There are different repayment options after graduation or after you drop out. Standard repayment plans have similar fees and require monthly payments over a 10-year period. Some students decide on a graduation schedule for their repayment plan, where loan payments start out low and then increase every 2 years.
The normal time period for student loan repayments is usually up to 30 years. The repayment period for these types of loans averages between ten and thirty years. Sometimes a student consolidation loan is actually the easiest way to get a simple and affordable loan repayment plan.
The popularity of student loans has skyrocketed over the years as recent inflation has been tied to low loan interest rates. Now, before you give up your college education, remember that student loans can easily make that dream come true.