Shopping for Education Loans

by admin on August 20, 2011

Educational loans are intended for students enrolled in colleges and universities in the US, who are making progress toward completing their program of choice. Loans are available from the federal government, banks, and other financial institutions, depending on the students’ financial situation and individual requirements. If you are not offered a scholarship or still need additional financing to pay your tuition and other expenses, here are some options to look at.

 The first place to check for financing is the Direct Loan Program of the Federal Government. Several types of loans are offered under the program – subsidized, unsubsidized, PLUS, and consolidation. Subsidized loans are available to students who demonstrate financial need, in compliance with federal regulations. No interest is charged while students are enrolled full- or part-time, during the deferment period and the grace period. Unsubsidized loans are also offered but not based on financial need. Interest is charged during the period of study, the deferment and grace period. PLUS loans are available to professional and graduate students as well as parents of dependent students. PLUS loans cover all education expenses related to attendance, less other financial assistance. Interest applies to all periods. Finally, consolidation applies to all eligible student loans extended by the federal government. These loans can be consolidated into a single Direct Consolidation Loan.

If you need more options before you make a choice, you can check with some of the big banks. The U.S. Bank is one financial institution which offers student loans. They are offered with low interest rates, AutoPay discounts, and deferred payment. Two basic loan types are offered – the No Fee Student Loan and the Fixed Rate Student Loan. The first type is a variable rate loan, featured with a number of benefits. No fees apply, and students receive the full amount. The variable rate can be as low as the prime, plus 0.20 percent (3.39 percent APR).  AutoPay guarantees a further reduction of the interest rate by 0.50 percent. If a creditworthy cosigner is willing to cosign the loan, you may qualify for an improved interest rate. The payment plans come with terms of up to 15 years, making repayment quite affordable. Deferred payment is also offered. The Fixed Rate Student Loan is a second option, going with an interest rate of 7.99 percent. Deferment of payments is available. No repayment fees or application fees apply, but there is a reserve fee in the amount of 2 – 9 percent. The aggregate loan limit is set at $200,000, and the minimum loan amount is $1,000. The loan covers the cost of education minus scholarships and other financial aid.

Another financial institution you can check with is Citizens Bank. It offers student banking and student loans. Student loans come in several varieties, but you can check the Student Money Bundle first. This package combines cash back rewards, discounts, online bill pay and banking, instant money transfers, and more. Additional benefits include email alerts, mobile alerts, and debit card for direct purchases. To apply, you have to be a US resident, 18 years of age or older, and have a valid state ID or driver’s license. You have to provide your current address and previous address, email address, date of birth, and valid driver’s license. The TruFit Student Loan is another loan offered by Citizen’s Bank. It goes with no annual fee, variable interest rate, and immediate, interest-only, or deferred payment options. The interest rate is from 1-month LIBOR plus 3 percent up to LIBOR plus 9.75 percent. The rate is based on creditworthiness, your chosen repayment plan, and presence of cosigner.

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