If you carry out a survey every student studying in Canada, the UK, the US Germany or other developed countries, and ask them how they pay for their education or how they survive in school? You will discover that 60% of them obtained student loans. And 20% of students are those who either on a well-paid scholarship or come from a rich home, and the remaining 20% have jobs.
It is very challenging to fund your education and it is arguably one of the most expensive self-investments. When it comes to paying for your tuition and other academic-related fees, you will find out that sometimes you need a little help.
A student loan offers students an option and a way to get extra cash to take care of their bills and academic expenses. There are two types of loans available to students; the Federal student Loan and Private student loan. You can read more about them here.
How is Federal Student Loan Different from Private Student Loans
A Federal student loan is issued to students by the government, sometimes they are managed and controlled by the provincial or state government of the region you reside in. A federal loan gives students limited options on the rates they are allowed to get at a particular period.
The main disadvantage of Federal Student loans is that it may not allow you to borrow more than $20,000 at rates ranging from 4.5% to 8.0%.
A Private student loan is controlled by private firms or individuals such as credible whose current partners include Citizens Bank, College Ave, Discover Student Loans, EDvestinU, INvestEd, Sallie Mae, and SunTrust.
You can get the rates of these lenders with one application at credible. Credible offers you a platform to connect with multiple lenders.
These lenders offer you loan rates between 2.0% to 20% which is sometimes way more than the federal loans. However, you are free to take loans that could amount to as little as 2% interest.
How To Get The Best Student Loan
- When applying for a loan, you should do some research and explore the different loan options and programs.
- You should look for loan programs that offer long term loans from three years and above.
- Look for loan programs that offer a lower interest rate.
- A loan program that does not require you pay an initial fee
- No Prepayment Penalties
- A loan program that offers bonuses should also be an option.
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