For many people in this country, student loans are an absolute necessity. For many families, the cost of tuition, books, housing, and food are outside the realm of possibility. Without loan programs, many of us could never have a college education.
Many of the world’s countries provide few or no options that help people to pay for education after high school. Fortunately, for those that live in the U.S., there are plenty of options available. College educations are within reach for almost anyone, as long as they are willing to pay the price.
Those who are looking for student loans would do well to educate themselves on the different programs that are available. If they do, they will often find affordable loans, loans that offer interest rates that are well below market value.
A decision that has to be made is whether the parent or student will secure the loan. Either way, there will be tax benefits. The current program offered by the federal government provides the largest percentage of student loans out there. It loans about $50 billion worth of student help each year.
Many states provide loan options. Usually the actual funds are provided by a bank, and are then guaranteed by the state. To find out whether this is an option of your state, you can visit your local bank. They can tell you everything you need to know about state guaranteed student loans.
In some cases, individuals can’t qualify for state or federal student loans. This is usually because of high earning parents. The federal government determines whether a person qualifies for loans by looking at their parent’s income. If you don’t qualify for a student loan that’s guaranteed by the state or federal government, you may have to look at private loan options.
Federal student loans carry with them a lot of advantages over other types of loans. Federal loans are one of the only types of true guaranteed student loans. They provide the guarantee that the loan will be repaid, thus eliminating the need for collateral. This means that if the loan is defaulted on, the federal government will repay the money to the bank. They will, of course, try to recollect the money from the student or parent who took out the loan.
If you need a student loan, you should make sure to take a look at each of the following options: Stafford loans, Federal PLUS loans, bank student loans, college-board loans, and private loans. Weigh how much each loan will cost in interest before you make a decision. For most people, the federal options will provide the best interest rates.