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What are some of the federal US student loans?

I have been living in South Carolina all my life. I have recently finished high school and will be joining university later this year. I do not want to apply for the SC student loan before exhausting all my federal options. I considered applying for Citibank student loans but quickly changed my mind after hearing the news on how this bank was unscrupulously minting millions of dollars from students who took loans there. Is there anyone with information on the federal student loans that are available to students? Thanks.

Naomi Doyle

in Student Loans

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Zach Chandler on May 7, 2018

The Department of Ed offers two types of federal US student’s loans:

The Direct Loan (William D. Ford Federal Direct Loan Program).

This program is the most extensive federal student loan service. In this program, the provider of your loan is the U.S. Department of Education. Direct Loans can be put into four groups:    

  • Direct Subsidized Loans- These loans are for undergraduate students who show that they are in need of financial help to meet their college costs or career school expenses. Currently, the interest rate on this loans is 4.45%. Your loan will not be charged interest during certain times. The maximum amount you can receive each year is $5,500 depending on your dependency status and grade level.
  • Direct Unsubsidized Loans- Professional students, graduates, and undergraduates qualify for this loan. You do not have to demonstrate financial need to receive it. The interest rate is at 4.45% for undergraduate students and 6% for loans given to professional degree and graduate students. You are responsible for paying the accrued interest during the entire life of the loan. You can receive up to $20,500 every year depending on your dependency status or grade level.
  • Direct PLUS Loans- These are loans offered to professional or graduate scholars and parents of dependent undergraduates who are in school too. These loans are made to pay for education costs that are not covered by any other financial aid. For your parent to qualify for this loan, he/she should not have adverse credit. The interest rate is 7%. The maximum amount you can receive is the cost of attending a particular college minus financial aid that the student has received.
  • Direct Consolidation Loans- These loans allow you to merge (combine) all of your qualifying federal student loans into a single loan with one loan servicer.

The Perkins Federal Loan Program

The Perkins loan is a school-provided loan program for both graduate and undergraduates who demonstrate dire financial need. In this program, the school is your lender. To determine if you qualify for the Perkins loan, contact the financial aid office at your school. At 5%, the interest rate on Federal Perkins loans is lower than that on SC student loans. Undergraduate students can receive a maximum of $5,500 while graduates can receive a maximum of $8,000. The total lifetime limit is $60,000 for graduate students and $27,500 for undergraduates.

Citibank is no longer servicing Citibank students’ loans. 

Eric Bates2 years ago

I advise you not to consider private student loans such as SC student loans before exhausting all of the federal students’ loans available. If I had this information back in 2012, I would have avoided private student loans like the plague they are.  Despite refinancing my private loans, I still get frustrated by the never-ending phone calls from private loan companies asking me this and that. It is a widely accepted fact that private lenders harass their clients. Whenever you have a query, they do not pick up your calls to clarify your issues, and when you get a response from them, it is often rude.   

Moreover, after making my repayments, the same does not reflect on my online account. At times, I cannot even log into my account. When I give them a phone call, guess what happens? Nobody answers me. Keep off private loans to avoid this nightmare!  


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