Student loans are loans offered to students to assist in payment of the costs of a professional education. If you have chosen to apply for private student loans, then you will need to know whether you are eligible or not, prior to applying for any private loan.
Basically, all college bound students are eligible for Federal Student Loans, which are federally-backed and processed in accordance with rules and regulations, issued by the United States Department of Education.
Even in a tight economy, getting a loan to go to college is quite possible. As a matter of fact, it can work to a persons advantage to apply for a college loan in a tight economy. Often, government intervention in uncertain economic times, makes applying for and obtaining a loan to go to school easier and faster than usual.
Advocates of private student loans suggest that they combine the best elements of the different government loans into one: They generally offer higher loan limits than federal loans, ensuring the student is not left with a budget gap. Also, private aid loans typically have variable interest rates while federal loans have fixed rates. When federal government loans do not meet all of your needs, private financial aid loans can help to bridge the gap.
Students and families with excellent credit will generally receive lower rates, and smaller loan origination fees than those with less than perfect credit. Students with bad credit can get the necessary funds as long as they meet the requirements. Students are automatically considered for student loans when they file the annual FAFSA. Students who fail to qualify for federal loans, or who need to borrow more to cover their college education costs and expenses, can turn to private loans.
For many students, a great advantage to private loan programs is their families may have too much income, or too many assets, to qualify for federal aid. Thus they often cannot qualify for a government backed student loan. However, there are many private loan programs to help with students who come from a more affluent financial background.
Eligible loan programs generally issue loans based on the credit history of the applicant and any applicable cosigner/co-endorser/co-borrower. Often, families with large assets or large incomes can find a near perfect fit, with privately funded student loans.
If your borrowing needs are not met by the federal programs, lenders offer a variety of supplemental borrowing programs known as Private or Alternative Loans. However, some graduate programs (notably top MBA programs) are tied to private loan providers, and in those cases no co-signor is needed, even for international students.
It’s wise to check out the specifics and benefits offered by different lenders, as you might go with a lender that is not the lender your school says is their “preferred” lender. This is why it is recommend whenever possible, to apply for federal aid.
Federal loan programs offer several advantages, including:
Easy application process –
Competitive interest rates –
(and perhaps most importantly) – borrowers can delay repayment until after graduation.
Other benefits of federal student loans include:
low interest rates-
lowered fees –
lenient payback policies.
If you have good credit, and meet the eligibility requirements, your application for student financial assistance will be processed, and you will receive assistance based on your financial need. Normally, funding is very quick, but currently due to the economy, processing and funding times have slowed down.
Find out what kinds of financing options are available for you to help fund your child’s college education. To help simplify the application process, gather required documents and other information ahead of time. Once your application has been assessed, you will receive a package of information that will include your loan documents, instructions on how to negotiate your loan documents, and your loan assessment details.
Because of the current economic climate, and with the current administration’s proclivity to intervene more and more into individual affairs, it is very important that you get started soon learning more about, and applying for your student loans needs. Right now is a good environment to apply for student loans of all types. With the current economic climate, the process of application could change at any time.