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Published by on Wednesday, September 4, 2013 at 10:03:00 AM

Top Loan Options for College Going Students

Top Loan Options for College StudentsThere are few times in a young person’s life more exciting than going off to college. The notion of actively heading down the educational path to responsibility and adulthood engenders many conflicting emotions like anxiety and optimism. But before the journey begins, the future college graduate must have all of his or her financial ducks in order, so to speak. And while it is certainly nice to have mom and dad foot the bill, not everyone can be so lucky. This is where student loans come in.

According to statistics in 2010, 67% of college graduates with a bachelor’s degree used student loans to help cover the costs of their education. But these days, with student loan interest rates at all-time highs, it’s crucial young people know what they are getting into before taking out that loan.

With that in mind, here are some things students need to consider about loans before beginning their collegiate life.

Selecting the right type of loan

Those who need to borrow money for school are going to be looking at two different types of student loan options: federal loans and private loans. Whenever possible, borrowers are going to want to look at federal loans, as these are usually the best options due to their lower interest rates. Major benefits to federal loans include fixed interest rates, which allow the student to easily calculate their post-college payments. There are even subsidized student loans available where the government covers the cost of interest while the student is in school.

Alternative options

Many students who take out federal loans often find that they don’t cover the total cost of education. In these instances, young people should look to alternative options to cover the cost of tuition – and there are many out there. For example, there are online resources to find scholarships and grants, and members of military families might just be eligible for G.I. benefits. Cutting expenses is also crucial for cash-strapped students, and taking on a roommate or getting a part-time job may be necessary. Another option is to take out a private loan.

What to know about private loans

As mentioned above, federal loans are ideal due to their lower interest rates. Indeed, some private loan rates are as high as 16%. But those who feel they have no other option than to consider a private loan should first consult their school’s aid office and obtain a form stating they need additional financial assistance. From there students can consult private lenders – usually banks – and shop around for the lowest interest rates possible. It’s also a good idea to negotiate a loan agreement that allows for some measure of flexibility in case the borrower can’t always make prompt payments. The borrower should also know that most private lenders will require a cosigner.

By adhering to the above guidelines, those embarking on a college path should be able to find a financial option that works for them. And with lifelong debt statistics at record levels, graduates of colleges and universities should, above all else, commit to prompt payments of their monthly loan bills.

Jennifer Palmer is a professional blogger that provides financial information on savings and loans. She writes for InstaLoan.com,, a leading title loan lender.
Published by IzajAhmed Shaikh.
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ME AS AUTHOR

I am, Mr. IzajAhmed Shaikh, a Computer Professional and a Pro. Blogger, who belongs to Shahabad, Karnataka India. My basic Qualifications are B.Sc., and M.C.M. done from University of Pune., formerly known as, Poona University,. I like to write articles based on my personal experiences.

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