What is a Federal Student Loan?
People who choose to enroll in a four-year college or university experience can benefit from a federal student loan. Students from community colleges or career schools could get it as well.
A federal student loan is decided based on some financial needs. To qualify, students should meet several requirements and other basic eligibility; also, they need to submit to FAFSA (Free Application for Federal Student Aid).
There are also five types of federal student loans which are: Stafford for Dependent Undergraduates, Stafford for Independent Undergraduates, Stafford for Graduates, Parent Plus, and Grad Plus.
What is a Private Student Loan?
A private student loan is always offered by a bank, online lenders, or a credit union. Students can use such a loan to pay for their college costs.
Private loans are perfect for those who are undergraduate and need a co-signer to receive such loans. Moreover, this type of loan could offer one 10-year repayment term, while others might come with a bonus period of 15 years.
Federal Student Loans Vs. Private Student Loans
Everyone knows the importance of paying for college. Such a fact represents one significant financial priority for many of us, but the ever-growing cost for higher education might reach beyond other people’s financial income.
When you don’t have any savings or funds to support the cost of your children’s college education, you might want to take into consideration loan options.