Student Loans Low Interest

For most people, student loans act as the first large monetary commitment you will ever make. They can be a great investment for people who might have otherwise struggled to continue their education. When looking for student loans, low interest agreements should be on your radar. If you are taking tens of thousands of dollars worth of debt, you want to do it at the lowest rates possible. The nice thing is that a low interest student loan is within your grasp, even if you have yet to establish any credit. You just have to explore the many options to find student loans with low interest.

Starting with government sources
Whether applying to an undergraduate program or graduate school, your first move should involve a Federal Application for Student Financial Aid. Your FASFA, as it is affectionately called, will give you a chance to qualify for federal student aid of all forms. In addition to certain grants that might come your way, you will also be in the running for student loans with low interest. For federal student loans, low interest means somewhere in the 6%-7% range. This is a much better deal than most people will get with private lenders.

There are many different types of student loans with low interest, but the most popular is probably the Stafford Loan. This loan comes in either subsidized or non-subsidized form, with the government paying interest on subsidized Stafford loans while you are still in school or unemployed. Additionally, the Perkins loan can help you make it through undergraduate studies.

Government loans require no credit check in the beginning, and as long as you stay on top of the loan itself, you will continue to qualify. They can be renewed as long as you are a full time student, and the amounts stay the same over the course of your time at a university. The amount that you qualify for will be determined by your expected financial contribution, which is calculated when you submit the FASFA. Federal loans are also available for graduate school, with the government providing just more than $21,000 in annual loans for people headed to business school, law school, medical school, or any other graduate program.

The downside to these loans is that they can only be applied to fees charged directly by the school. This means that tuition, university charges, and university-based room and board are all that these loans cover. If you want to live outside of university housing or enjoy a meal somewhere other than the dining hall, federal student loans won’t provide coverage.

Private lenders
You can get a low interest student loan through a private lender, though this will require good credit. Private lenders will run a credit check just like they would for typical personal loans, so if you seek low interest private funding, you may have to rely on a co-signer to make it happen. With these student loans, low interest rates will fall somewhere in the 8%-9% range, though you can pay more if your credit is damaged.

Private loans are more flexible, since the payouts can be used to handle all expenses associated with college. While federal loans are typically sent directly to the bursar’s office at your university, private lenders send a check directly to you. A private student loan can help pay for car expenses, books, or your monthly utility bills in addition to your tuition.