Government Student Loans

Financing college education is the most daunting task faced by many students in the United States. Fortunately, the federal government knows about this integral issue and has made arrangement for several financial aid schemes to help students in need of assistance for paying for college. The schemes include grants, federal work-study programs, and federal government student loans. Although a grant is the best form of financial aid as it is gift money and doesn't have to be paid back, but not all students get grants. Government student loans are the most common part of the financial aid package allotted to thousands of students each year.

Types of Government Student Loan
There are several types of government student loans mainly differing on the basis of subsidization. The main step for application for loans with student as the receiver is the submission of Free Application for Federal Student Aid (FAFSA). Following are the most popular types of government loan programs devised for financing college education:

  • Perkins Loan
    With a 9 months grace period after graduation and a low 5% interest rate, the Perkins Loan is only given to students in extreme financial need. Moreover, the Perkins Loans are government subsidized student loans, which means that the interest during the student's education and grace period is paid by the government; the repayment period is ten years.

  • Stafford Loan
    The fixed interest rate loan with rates going as low as 3.4%, the Stafford Loan is a gov student loan very popular among students. It comes in two packages; the subsidized version with 3.4% interest rate needs you to display financial need on your FAFSA, and the unsubsidized version with 6.8% interest rate doesn't require a display of financial need for approval. However, the interest starts accruing on your unsubsidized loan as soon as you receive the first payment.

  • Parent PLUS Loan  
    Parent PLUS Loans are government student loans that can be taken out by parents wishing to supplement their personal finances and their children's financial aid packages. They need to pass a credit check for getting approval for these loans.

Frequently Asked Question(s)

Q:Can I apply for gov. student loans for online programs?

A:Yes, students can apply for gov. student loans for online programs. However, it is important for students to make sure that the institution is appropriately accredited and recognized. Students interested in online courses are advised to make sure they check the accreditations of the program as well. In some cases the institution might have the accreditation but the particular program students are applying for might not be. For an extensive list of accredited institutions, students are advised to check our website.

Q:How come the government student loan rates are lesser than those of private loans?

A:It is true that when you look on an overall, it is visible that Government Student Loan Rates of interest are lesser than those of the provide lenders. This is because the federal and state governments of the United States back these loans. However, if you further investigate, you will see that the private student loans give away much bigger amounts in loans and have more flexible repayment options.

Q:Is the Government still making Federal government student loans in the current economic climate (Fall 2012)?

A:Federal student loans are still readily available to many students provided that they meet the criteria, at the time of the application. Another factor will the time at which applications are made- if it is left too late, then there is a risk that the amount in the Federal fund may be used up.

Q:What can you tell me about the government student loans payment?

A:Government Student Loans Payment program is very convenient. Students are often given relaxation if they are unable to make payments. These payments are to be made on a monthly basis as opted by the applicant. However, in order to facilitate students, the government also allows them to defer payments until they have graduated.

Q:Can you give an overview, one that is brief about government student loans?

A:Government student loans facilitate students who have trouble financing their higher level education. Government student loans are an example of one of the most common financial aid packages allotted to thousands of students each year. Government student loans mainly differ on the basis of subsidization. The main step for application for loans for students is the submission of Free Application for Federal Student Aid (FAFSA).

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