What Are My Options With Financial Aid
Many college students have to rely on federal government college student loans to finance their educations. These college student loans have lower interest rates and do not require any credit checks or collateral. College student loans can also provide a variety of deferment options and extended repayment options as well. College student loans do include the Federal Stafford and Federal Perkins College Student Loans.
A Perkins College Student Loan can be awarded to undergraduate and graduate college students with extreme financial assistance needs. This kind of student loan is a campus based college student loan program, as the school is acting as the financial lender using a limited pool of funds usually provided by the federal government. The Perkins College Student Loan is the best college student loan available. It is a subsidized college student loan, as the interest will be paid by the federal government as long as you are enrolled in school allowing a nine month grace period after you have graduated. A Perkins College Student Loan has no origination or default fees, and the interest rate is locked at 5%. Your repayment period is 10 years.
The awarded amount of Perkins College Student Loan you receive will be determined by your school’s financial assistance office. The program will limit you to a $4,000 per year for undergraduate college students and $6,000 per year for graduate college students, with cumulative limits of $20,000 for undergraduate college student loans and $40,000 for undergraduate and graduate college student loans combined.
A Perkins College Student Loan will also offer you a better cancellation provision than a Stafford or PLUS college student loans.
If you find your borrowing needs are still not being met by the federal financial aid college student loan programs, many lenders and financial institutions can offer a multitude of supplemental borrowing programs known as Private or Alternative College Student Loans.
Parents of undergraduate college students can borrow parent loans such as the PLUS College Student Loan to pay for their child’s education. A new program that started on July 1, 2006, graduate and professional college students will also be able to borrow money through the PLUS College Student Loan program to pay for their own education.
A Stafford College Student Loan has a fixed interest rate of 6.8% for college student loans with a first disbursement date after July 1, 2006. (Previously, Stafford College Student Loans had variable interest rates (based on 91-day T-bill rate + 1.7% during school with an additional 0.6% increase upon graduation) capped at 8.25% or less, depending on your yearly adjustments.) All lenders and financial institutions offer the same rate for the Stafford College Student Loan, although some do give discounts for on time and electronic payment from your personal checking account.
The College Cost Reduction and Access Act of 2007 has reduced the interest rates on subsidized Stafford college student loans for undergraduate college students starting July 1, 2008. These reductions are also available only to undergraduate college students, not to graduate college students, and only for subsidized Stafford college student loans, not unsubsidized Stafford college student loans.
