Low Cost Student Loans
You're all prepared for your college with a letter of admission in your pocket, but you're face to face with a huge issue; how to finance your college education? Don't worry as the federal government has several schemes for helping students like you. The schemes not only include gift money in the form of grants but also jobs and low cost student loans.
The federal government is on top of the list of loan providers for granting low rate student loans. Besides the low interest rate, students don't require a cosigner and don't have to pass a credit history check. However, the competition is tough for federal low interest student loans, so submit your Free Application for Federal Student Aid (FAFSA) as soon as it becomes available and preferably do it online. Online submission removes the chances of errors, and the processing is also faster.
Types of Federal Low Cost Student Loans
Stafford Loan: The Federal Government's Stafford Loan program is a very popular loan program among students especially the subsidized version as the interest rate is fixed at only 3.4%. Moreover, the student's interest during the education and grace period (6 months) is paid by the government. However, students are only given this loan if they've financial problems depicted by their accurately completed FAFSA. The unsubsidized version with interest rate higher at 6.8% doesn't require a display of financial need. However, the interest starts accruing with the first payment of the loan to the student.
Perkins Loans: Students in extreme financial need may be granted the Perkins Loan, which is subsidized and has a 5% interest rate with a 9 months grace period. The loan usually has to be paid over a period of ten years.
Private Student Loans: It is difficult to find a low rate student loan among the private sector; however, you can improve your rates by asking a person with a good credit history to cosign the loan with you. Giving collateral against the loan such as a car, house, land, etc. is another way of lowering the interest rates.