College Loans – Find Your Ticket To College

When most students plan for college they are hoping to gain a scholarship that will take care of the entire education. Of course this rarely happens and they are also hoping that their parents can help out a little. When both of those options don’t take care of the entire college program there are always college loans. As a last resort or even a first option there are many reasons why college loans can help out students. College loans are designed to help the student get the secondary education they need to succeed in the world. Chances are when you have a college loan you are going to be looking for the best loan out there. You have many options from federal, state, and private loans. You will find that each has its benefits and disadvantages.

First a federal college loan or Stafford Loan is going to require a FAFSA report. This report not only looks at the college student, but also the parents. The report will tell the government how much the parents make, what they can contribute, and what the student can contribute. This usually makes the federal loan the least amount of loan you can have. In other words the amount borrowed is usually a couple of thousand dollars a year and will of course depend on the school you have chosen to a degree. In some instances the government loans may not work for you based on your parent’s income. This can be difficult for those that really can’t afford school. The federal loans also give the best interest rates around. A smart student will try to get a federal college loan and also another to borrow the amount needed rather than seeking just one loan.

When you have a state or private college loan you are seeking a loan that is easier to get, but also increases the interest rate. Most federal loans are going to be around 2 to 4%, while others can be as high as 10%. This is not the best option when considering the amount you may have to pay back. However in some cases a person is not eligible for the federal college loans so they must go elsewhere. When you go elsewhere there are things you should look for. First see what interest rates are out there. You will also want to check the company you are dealing with. Do they work directly with a bank or are they a middle company? Is the loan through the state? State loans can be nice, but they can only be consolidated when you have several loans with the same place. They won’t consolidate other loans for you. Consolidating is important for locking in an interest rate and a lower monthly payment.

College loans are designed to help us. However there are scams out there and you have to double check with the company you are trying to borrow from. Remember if it seems too good to be true it usually is in the end.