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What can you tell me about school loans?

I would like to find out about school loans. What are these and how do students benefit from them? I would also like some information on student loan rates. Are they so dear to repay? What are the interest rates like? Tell me about how to apply for a student loan. Is it a very tedious process? Finally, what are graduate student loans? I need to get a loan for my studies, but I have no reliable information on how the whole process is. I hope you will untangle it for me.

Ashley Howard

in Student Loans

1 answer

1 answer

Chelsea Hayes on May 23, 2018

I also hope I will be able to untangle it for you. Loans for school are given to students to enable them to pursue their education and repay later. Some of these loans are given directly to students, while others are given to their parents on their behalf. Students who have employment or a reliable source of income can take the loans themselves. This especially applies to those who are employed part or full time. The loans are further categorized as federal or private. The federal loans are provided by the state, while the private ones can be accessed through corporate organizations or other student support programs. The loans involve the following.

  1. The interest rates on student loans are generally low compared to those charged on commercial ones. According to US News the rates range from 3.76 % to about 7% among the main lenders. It is important to note that these rates are revised on an annual basis, going down or up depending on market conditions. These variations can only affect you if you take a loan with a variable interest rate. Those with a fixed interest rate, like the federal loans, remain unaffected by these variations.
  2. Since you want to know how you apply for a student loan, I will tell you that it is a matter of filling in forms. This can be done physically in the office of an organization, or online. The latter option is the most common these days. Meaning that you will not have to travel to the offices of the loaning organization. Federal loans can be applied for online, through the FSA website. You will get sufficient guidelines on the application process from the site.
  3. The private loaning organizations are many. You can easily find them online and look at what each has to offer. Among the most reliable ones are the Sallie Mae, College Avenue and Citizens Bank. They also have sufficient information to guide you through the application process.
  4. Loans for graduate students are usually higher than those for undergraduates. That is because their education costs much more to complete. They also pay more in terms of interest rates. Graduate students borrow a maximum of $20,500 per year, with medical students going as high as $40,500. Their repayment rate is at 6%. Comparatively, undergraduates can borrow up to $12,500 at a lower repayment rate of only 4.5%. 

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