Happy New Years everyone! Hope all of you had a fun, exciting, and also safe night!
Anyways, in this post I’ll discuss the benefits of the Stafford Loan, and how it will help you more in affording college than other loans might.
Both the Subsidized and Unsubsidized Stafford Loans have many financial benefits you may not find with private loans. Here are some reasons they’re good ones:
-Just like with the Perkins Loan, interest doesn’t accrue on the Subsidized Stafford Loan while you are in college, which will definitely help in making affording college easier! As I mentioned for the Perkins Loan, not having to pay interest on the amount borrowed while in college can save you up to thousands of dollars
-These loans are federally guaranteed; although the loans are given through the lender, the government is the one that offers it to students, and also guarantees repayment to the lender if a student defaults on a loan. As a result, interest rates on these loans will be lower than you will find with many private loans (as you see with the Stafford Loan) .
-Unsubsidized not based on financial need; even if you are rich, you are still eligible for this loan that beats many others! And if you are financially needy, you’ll get an even better deal with the subsidized loan, and can take advantage of the unsubsidized one as well. This will definitely help you in paying for college if you decide to take the loans route.
-Since the government guarantees repayment to lenders, the lenders will likely guarantee these loans to the government…meaning the Stafford Loan is guaranteed by the government to be available to you!
-The Stafford doesn’t require a credit check, a co-signer, or collateral. As with the Perkins Loan, this is to your advantage in finding money to pay for college; even if you are a student with bad credit, you can still receive this loan without a problem and can then use it as an opportunity to improve your credit.
-You will have to verify this one…but I have heard that students who are turned down for a plus loan can borrow another $4,000 the first two years and $5,000 for the years after that. But I am not completely sure on this one, so verify it.
-Available to non citizen permanent residents; from what I hear it is harder for permanent residents to receive loans, so this loan is one that you WILL be able to utilize as a form of financial aid.
-Minimum monthly payment of $50; with ten years to pay off the loan and only a requirement of $50 per month, this should be a problem at all when you are pulling a high five-figure or a six-figure income J
Some other advice:
-If you are going for the unsubsidized loan, remember that interest will be charged from the moment you take the loan out until it is paid in full. Putting off payments longer will mean more interest in the end.
-Remember that you MUST fill out the FAFSA to get this financial aid; don’t rush with the FAFSA deadline; actually submit the form as soon as possible so you can ensure that you get a loan offer fast and be guaranteed one (and possible more grants that are offered first-come first-serve).
Overall, the Stafford Loan is definitely one to look into, and will help make affording college easier for you…along with the process of paying your loans back.
Jan 1, 2009
