If you are a college student preparing to borrow some money as a part of the student loan, you should learn everything that you can concerning what student loans are and why you need them. They can help you when you pursue your education. Since the price of education is rising, then student loans provide you more opportunity to attend the college of your choice.
There are 3 main types of student loans accessible. These are federal student loans, private student loan and parent loan. The most commonly accepted federal loans are Perkins loans and Stafford loans. What is advantageous behind federal student loans is the fact that federal laws control the rates of interest charged for the programs. Lender should provide federal loans at the specified rate of interest that is lower than the national rate of interest. Also, federal student loans can be consolidated after your graduation, allowing your loan repayment plan to come under one big umbrella.
A private student loan is different from a federal loan, and the students that apply for these do not have to complete federal forms. Typically, private lenders provide these loans and make them cost more as there is no legal demand to keep within a particular rate of interest. In addition, private loans require students to provide their credit history, as well as the fees and interest paid on student loans are based on their credit score. Parents can be asked to co-sign for private student loans, thus making them answerable if students need to defer their payments at any time.
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