If you want to understand US Student Loans, you need to spend a little time doing some background research to ensure that you get the best possible deal for yourself and your family.
The first step is to understand the difference between loans and scholarships. This is quite simple - loans have to be paid back and scholarships do not. So it is very much in your interests to find out if you are eligible for any scholarships first.
Scholarships are awarded for a number of reasons, which might include financial need, disability or achievement in academic work or in sport. Sometimes they are awarded by a specific school or to a specific group of people, for example ethnic minorities.
The scholarship application process usually involves writing an essay and so you will have to spend some time considering what you will write about, as this can be the determining factor in making the award.
When it comes to loans, the most popular are those which make up the Federal Student Loan system. This is generally speaking, the best option for most college students. If you haven't been able to get any scholarships or if the ones you do have don't cover all your expenses, you will need to consider a student loan.
Remember that we aren't just talking about tuition and books, you have to think about accommodation costs, travel to and from college and travel home during vacations, and, of course, entertainment since you do need to talk a little time away from the books.So you will probably find that you need more money than you first anticipated..
Let's take a look at the various US student Loans you can apply for.
First of all, you need to be aware that there are a number of different US Student Loans, and the main loans fall into the following categories - Federal Student Loans, Private Student Loans and Student Consolidation Loans.
Federal Student Loan
These loans form part of a government loan program and tend to be more flexible and to have lower interest rate than private loans. They also include loans which parents can take out to help their dependent children through college. You should always look at federal student loans first.
Private Student Loans
Private loans are offered by private loan companies and don't usually have the same favorable terms as government loans. However, they are useful if you find that you need a little more than your federal school loan provides. Try to use these only for top up funds.
Student Consolidation Loans
Student Loan Consolidation allow you to refinance several loans into one new loan, so that you just have one monthly repayment and you can also extend your repayment period.
Student loans have different loans and conditions and so it is important to find the ones which are most suitable for your own circumstances. Start early, do plenty of research and always read the fine print.
