Options in Government Student Loans for Online Students
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Filed under Student Loans
If you have decided to join the ranks of distance learners and get your education online then looking to government student loans is a way to guarantee that you will not drain your bank account and that you will not have to work day and night to pay for your education. Private student loans are another option; however the best choice is government student loans because more prospective students will qualify for these. As well these student loans are federal loans and offer generous terms and generally the lowest interest rates.
The federal government offers a variety of student loans to those wishing to further their education. Here we look at some of the most common of these government loans, starting with Federal Perkins Loans. The interest rate on these loans is very low and they are offered to students who are in the greatest of financial need. While still in school the government pays the interest on the loan and continues to pay it for a nine month grace period after graduation has taken place. The student will then start to make payments in the 10th month after the grace period has ended.
Another government student loan that is very popular in the United States is the Federal Subsidized Stafford Loan. These loans also have a low interest rate. Just the same as the Federal Perkins Loans, the government pays the interest while the student is attending school. However in this case the grace period is only six months in duration. The government pays the interest for the six months and then it becomes the responsibility of the student to begin making regular payments.
Then there is the Federal Unsubsidized Stafford Loans. These loans have a low interest rate but they begin to accumulate interest as soon as the student is given the money from the loan for their schooling. The first payment on the loan is due as soon as the six month grace period draws to a close.
Then there is another government student loan called the Federal PLUS Loan. This stands for the Parent Loan for Undergraduate Students. It is not available to students per se but to their parents if the parent(s) intends to pay for the student’s education. The payments on the loan start as soon as the money becomes available. In order to qualify for this loan the parent or parents of the student must either have someone who can co-sign the loan or else they must pass a credit check.
There is another type of Federal PLUS Loan that is geared towards graduate and professional degree students. An adult student who no longer qualifies for other types of government student loans for whatever reason can apply for this student loan. The student must pass a credit check to qualify or he or she must have a co-signer for the loan. The disadvantage of this loan is that interest begins to accrue as soon as the money is in your hands. As well, you must begin making payments while you are still in school. It is possible however to apply for a payment deferment while you are still enrolled in online classes. If the deferment is approved then your first payment will not be due until 45 days after the deferment period is over.
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