Wednesday, 7 October 2009

Various Aspects of Student Loans

Today, the overall cost of private as well as public colleges are increasing steadily and students desperately try to find out means which will help them fund their education. Student loans are a good option to support their education. These educational loans are used to pay for tuition and other expenses needed for colleges and universities. These loan options are for undergraduate degrees, graduate degrees, and even specialist programs, such as medical or law school.

A student loan can take care of the tuition fees, and can also be used to buy computers, books and other educational materials which are generally needed by a student. The principle behind a student loan is the student loan repayment scheme. As per the scheme, the repayment to the lender must start, with interest, within a certain time frame after graduation.

There federal student loans, private student loans and parent loans are the three main types of student loans available. Federal loan has the advantage as federal laws regulate the interest rates charged for these programs. You can get federal student loans at specified interest rate, which is usually lower than the national interest rate and the loan can also be consolidated after the student graduates, allowing the student loan repayment plan to fall under one large umbrella.

But in private student loans, a student has to submit his credit history. However, there are no federal forms to be filled. The interest rate are a bit costly than federal loans. And in parents’ loans, parents apply to encompass any additional cost their child's financial aid or student loans won't cover. The interest rate is fixed in such loans.

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