Benefits of Federal Student Loans & Considerations When Applying For a Private Loan

Benefits of Federal Student Loans

• Federal Loans have a pre-determined, fixed interest rate which is often lower than those offered through private loans.
• The interest on Direct Subsidized federal loans is paid by the government as long as the student is enrolled at least half-time, as well as through the grace period.
• Federal loans are offered each year a student files a FAFSA, provided they meet general eligibility requirements.
• Once a student graduates, they have the option to consolidate federal loans for a lower payment. 
• Federal loans have many repayment options that may be beneficial to students as they enter repayment or if they experience financial hardships during periods of repayment.
• Some students may qualify for loan forgiveness programs.
• For more information and answers to frequently asked questions, visit the Federal Student Aid website.

Considerations When Applying for a Private Loan

• Does the lender offer fixed and/or variable interest rates?
• Are loan processing and/or origination fees charged?
• What are the loan repayment options?
• When does repayment begin?
• Can the loan co-signer be released during repayment?
• Have you taken advantage of federal loan options?
• Have you explored and exhausted other means of educational funding?
• If you have difficulty making payments, what options do you have?
• Are there pre-payment penalties?
• Are there deferment or forbearance options available?