Types Of College Loans.

August 11, 2008 · Filed Under College Life 101

Whether you are going to college for your first year or you’re going back for one more year of adventures. College is very expensive and most people can’t afford it all together or didn’t get enough financial aid. You should know what type of loans you are dealing with or what types of loans can you get. I came across this small article that has a definition for some of the college loans and I believe it should be helpful to everyone.

Private Loans: There are hundreds of agencies that will help college students find a loan. Do some research and find the one that will work best for you. Private student loans can be used for education related expenses including tuition, books, transportation and room and board. Some also give you a $300 principal reduction reward upon graduation.

PLUS Loans: A PLUS loan is given out to the parents of the students. This allows the parent to take out as much money as they need to help pay the tuition and other needs of the child’s education.

Stafford Loans: Stafford loans are loans that are usually given out by agencies. They work with the federal government so that college can be a possibility for everyone who wants to attend. Standford loans are taken out in the name of the person who is attending college. Standford loans allow dependent undergraduate students to borrow $2,625 their freshman year. For their sophomore year they are allowed $3,500 and $5,500 each year after that. Students who are independent can borrow an additional $4,000 their freshman and sophomore years. Once they’ve reached their junior year, they qualify for an additional $5,000 every year. Graduate students can borrow up to $18,500 per year. These are great because they are for both independent and dependent students.

You always have a financial advisor that could help you on making the right decisions and what you should do in certain situations. The best thing is to try to avoid loans all together as much as possible. Push hard for your grades so you can work on getting scholarships and grants. Look out for clubs on your campus that might offer scholarships to the people involved. It is also good to work on how you’re going to pay for your loans. Most of them are due when you graduate and get a job but some might not. Also pay close attention to the interest you have to pay, if it will change or be fixed.

Yasser

Tags: College, Loans