What are the best loans for college?

What are the best loans for college?

Revised on November 24th, 2010 at 8:03 pm | Financial Aid Counselor | Article of: Student Loan Basics | Resource for: |

According to many reports, average student debt is on the rise. One reason is because many students are staying in college longer than before to get a higher degree education. Another reason is many of them aren’t looking for the right loans; a lot of college students just sign up for the loan as soon as they can get it, so they end up getting the left overs.

Best loans for college students

Low Interest Rates. You are a college student who making bare minimum to survive a livelihood while working your brains off by studying hard to graduate on time; you won’t be able to pay the interest rates while in school nor would you want high interest rates making your debt balance double the original principal amount. Your focus should be on the studies, not on wondering all the time how you would pay back all the student loans. If you get low interest loan, you will have a piece of mind to some extent.

Financial Aid. By now you should know what financial aid is – FAFSA. It’s an aid package for college students who can’t afford to pay for college. All the college students qualifies for it, but some get more money than others depending on your income and circumstances. It offer pell grants, state grants, work study programs for those who are willing to work while in school and loans from various loans. FAFSA loans comes in various forms, some are subsidized which doesn’t charge you any interest while in school and some are unsubsidized loans which adds interest rates while you are still in college. They are called Direct Loans and Stafford Loans;  government pays for the interest rates you accumulate from private student loans. This is the best type of student loans for college. A nice thing is that you don’t have to pay back until you graduate or drop to less than half time enrollment for classes.

Loan from Employer. Some employers offer scholarships and grants for their employees who are taking college classes. Others offer, in addition to the ones mentioned, loans. A lot of employers won’t charge you any interest rates on it, and some will deduct your account balance as you keep working for them and accrue credits. A lot of companies help students pay off their loans when they get hired; it’s a good idea to ask about such benefits during the hiring process.

Credit Union. There are many Federal Credit Unions out there. A lot of them offer the best consumer loans as far as interest rates are concerned, far more competitive than private banks. Some of them you qualify after you join their membership; if the cost of membership is very low, it is good idea to find out their fees and charges.

Friends and Family members. It is understandable not all family friends can give you money for loans. But some do want to help during the time of need, and when asked during the right time for the right reason it strengthens the relationship further. Education is important to you, and your family and friends want the best for you. In the meantime, make sure you have a good plan to pay them back on time.

5 Responses to “What are the best loans for college?”

  1. Need suggestions on November 24, 2010

    I have been able to pay my first two years of college through savings but I am running short of money and may need to take out a loan in 5 or 6 months. What are the best options with low interest? Federal loans? I know nothing in the loans/college paying department. Any help or advice is greatly appreciated.

  2. Joseph Neenworn on November 24, 2010

    Fafsa. You should definitely talk with financial aid in your school. It’s the best deal and they don’t screw u over like other companies. I got loans with other companies, but I quickly consolidate with my college federal loan. Also, financial aid will grant you a lot of money. Students would generally have probably went to college for free for the first few years or most of it paid for if you had applied..depending on your situation. I assume they would since college kids are always running out of money – quite honestly, they are broke all the time. The best advice anybody will give you is to go talk to Financial AID!!

  3. freshmen in the house on November 25, 2010

    What is the best way to go for college if you need a personal loan to pay tuition.? It is not very expensive, since I go to community college instead of private. But I am looking to applying for a college loan that I can pay back once I graduate from college; I don’t want to be on debt forever like I hear about, it is very scary.

  4. what about parents as a lender? on November 27, 2010

    this might sound crazy for some of you, but while you in the college, don’t you think your parents should help you with your college loan? Like if the parents have money but choose not to help, is this bad? I think after you graduate, then he or she should pay for himself. maybe the parent’s obligation to help their children is logical as long as it is based on the situation where if their child finish the college and have well paying job, so there will be no need to burden the parental finance as long as their children can help in solve the loan.

  5. Sasha Corneve on December 14, 2010

    I am running out of college loans, should I do?

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