The 3 Most Popular Ways to Get Student Loans

Depending upon which career path you choose to follow getting a college degree is practically a necessity in today’s world. Getting that all important college degree can be incredibly expensive so for many people that means they will need to get student loans to be able to pay for it.

Fortunately in the United States it is rather easy for a citizen in good standing to secure a student loan to pay for higher education. There are basically two avenues to pursue as far as getting a student loan goes; applying for a government backed student loan or applying for a student loan from a private financial institution.

The following is a list of the three most popular forms of student loans available:

Perkins Loan

The Perkins loan features very agreeable interest rates, currently in the neighborhood of 5%. Both undergraduates and graduate students alike can qualify for Perkins loans. The period to repay this particular loan can be as long as 10 years and payments can be deferred until after the student leaves school.

A little known fact about the Perkins loan is that if you agree to work in the public sector for a specified period of time the loan will be discharged and or forgiven. The fields that qualify for this would include the military, teaching, law and medicine to name a few.

PLUS Loans

PLUS Loans are also available for both graduates and undergraduates who are enrolled in an accredited college either on a part-time or full-time basis. They can be either be subsidized or unsubsidized. These loans are distributed by the federal government to students through the schools they are enrolled in. Interest rates for a plus loan typically run higher than for a Perkins loan.

Stafford Loans

The final of the big three are Stafford Loans. These loans are available for both graduates and undergraduates enrolled at least part-time in an accredited college or university. It is based largely upon financial need and the student is required to begin repaying the loan six months after leaving school.

With a Stafford loan the government pays the interest while the student is still in school and repayment is deferred on subsidized loans. The current interest rate on both subsidized and on subsidized loans has a ceiling of 6.8% with a repayment period between 10 to 25 years.

How to Begin the Application Process

In order to get student loans the student must first be enrolled in a college or university. They then would complete a Free Application for Federal Student Aid (FAFSA) which will get the ball rolling.

Financial need is always taken into account as to how much of a student loan will be granted and there are no guarantees that any loans will be granted at all.

And remember, you should always check with your school’s financial aid and admissions office to see if there are any grants and scholarships that you can apply for.

The wonderful thing about grants and scholarships is that unlike student loans they do not have to be repaid. It certainly does not hurt to apply for them so by all means do so, even if you don’t think you have much of a chance of getting them. You’ll never know unless you try and you may just be pleasantly surprised at what you come up with.