| Page 2 of 3 < > |
Advice on Student Loan Options Takes On Added Importance
|
TOOLBOX
   Resize
COMMENT
 Discussion Policy
 CLOSE
Comments that include profanity or personal attacks or other inappropriate comments or material will be removed from the site. Additionally, entries that are unsigned or contain "signatures" by someone other than the actual author will be removed. Finally, we will take steps to block users who violate any of our posting standards, terms of use or privacy policies or any other policies governing this site. Please review the full rules governing commentaries and discussions. You are fully responsible for the content that you post.
Who's Blogging  |
What are the basic questions to ask financial aid officers?
What are the total costs I will need to cover as a student at your school? How does the package of aid you have offered me cover those costs? How much will I need to borrow, and with what types of loans? What lenders do you recommend, and why? Do you have any financial relationships with the lenders you recommend?
What are the major types of student loans?
The best loans are Federal Perkins and subsidized Stafford loans. They have fixed, reasonable interest rates, and the government covers the interest while you are in school. Students from higher-income families are not eligible for those loans, but they can still get federal "unsubsidized" Stafford loans, which I put in quotes because the government actually does subsidize them by keeping the interest rate reasonable. These are the next best choice for any borrower.
Federal PLUS loans are available to parents and graduate students as long as they don't have any bad marks in their credit history. Again, the interest rate is fixed, but some families may find that a home equity loan rivals the rate on PLUS loans.
Private or alternative loans are the ones to avoid. Their rates are almost always variable, without any cap. The rates can be as high as a credit card. Some families may be able to find a good deal, but these loans lack the borrower protections that come with federal loans, such as assistance during unemployment and disability.
How do students know which lenders they should choose?
