About Low Interest Student Loans

Low-interest student loans often lay "dormant" until your children reach college age. Then, the mystery and confusion surrounding student loans appear right after the "sticker shock" parents face when learning college tuition, room, and board charges exceed $30,000 per year. The fees quoted apply for even the most modest post-secondary accredited schools. Here is information to bring you some important knowledge.

Function

Most people understand the primary function of student loans: helping to finance post-secondary education. Yet, there is a bit more. Student loans should have low, affordable interest rates. They should allow students to concentrate on their studies, without worrying about immediate repayment requirements. After the original deferral period, student loans should provide for some time for the new graduates to secure a good job before repayment starts.

Significance

Low-interest student loans, along with grants, scholarships, and other student financial aid, drive the post-secondary education machine. Without this combination of financial aid for students, the entire system of higher education might face collapse.
Ivy League institutions and a few other universities with large endowment funds (gifts from wealthy alumni and patrons and investment earnings) would probably continue to function, but many smaller private and state institutions might cease functioning because students could not afford to attend schools.

Effects

Low-interest student loans form a critical component to higher education financing. After using a student's ability to maximize Federal loan borrowing, you can access the private student loan market. These loans are offered by private companies, but are still low-interest and deferred during your studies.

Misconceptions

Misconceptions regarding student loans include:
You can finance your entire higher education cost with Federal student loans.
Most recent college graduates can't afford to repay their student loans on time.
You can only get Federal student loans if you have a documented "need."
You must deal directly with the Federal government to receive student loans.

Features

By completing a FAFSA (Free Application for Federal Student Aid), you will open the door to all forms of educational financial aid. You can submit this document to multiple colleges, who can then help create a workable student financial aid package.
Federal student financing (Stafford and Perkins loans) can be combined with outside and/or school awarded scholarships, Pell grants (which do not have to be repaid), PLUS loans (made to students' parents), and other financing complete your financial aid.

Resources

• Learn More About Student Loans