There are three types of student loans: private loans, federal loans, and refinancing loans after you graduate from school. <\/p>\n\n\n\n
This guide will help you understand your college student loan options.<\/p>\n\n\n
Around 92% of all outstanding student loans<\/strong> are federal debt and this comes to\u00a0more than $1.6 trillion<\/a>.<\/p><\/div>\n\n There are many options to consider when it comes to student loans and depending on your needs, you may need a combination of private and federal student loans.<\/p>\n\n\n\n Direct Federal student loans are the main way the government is helping students finance their education. However, choosing the right type of federal loan is crucial as it can impact your financial future.<\/p>\n\n\n\n Federal loans are available to almost all students with a high school diploma, and they don\u2019t require co-signers or good credit. To apply, fill out the Free Application for Federal Student Aid (also known as the\u00a0FAFSA).<\/p>\n\n\n\n > Read more: How to pay for college<\/a><\/strong><\/p>\n\n\n\n Did you know that there are more than 42.8 million borrowers<\/strong> with federal student loan debt? The average student loan debt is more than $37,000.<\/p>\n\n\n\n Let’s take a look at the different types of federal student loans:<\/p>\n\n\n\n Two types of\u00a0federal direct loans\u00a0are available<\/strong>: unsubsidized and subsidized. Undergraduates who have financial needs may be eligible for subsidized loans. These loans are paid back by the government while you\u2019re still in school. <\/p>\n\n\n\n You’ll have a six-month grace period before the loan starts incurring interest, that you’ll have to pay along with the principal.<\/p>\n\n\n You may qualify for forbearance or deferment of your direct subsidized student loan, depending on your financial situation.\u00a0<\/p><\/div>\n\n\n Unsubsidized loans are available to both undergraduate and graduate students. You don\u2019t have to prove financial need. Unsubsidized loans start accruing interest immediately. You\u2019ll have to pay all interest throughout the loan\u2019s life.<\/p>\n\n\n\n You may choose to start paying back the loan while you’re in school, to potentially save you thousands of dollars after you graduate. <\/p>\n\n\n\n Your school will determine the number of loans you may take out a year.<\/p>\n\n\n\n These were only available to graduates and undergraduates with high financial needs until September 2017. Students borrowed money from their school and paid it back.\u00a0<\/p>\n\n\n\n Perkins loan forgiveness\u00a0may be available to those with outstanding Perkins loans working in public service.<\/p>\n\n\n\n Federal PLUS loans\u00a0for graduate students are available to parents and students. These loans have higher origination fees and interest rates than federal loans. They also require a credit check. <\/p>\n\n\n\n Borrowers with\u00a0\u201cadverse financial history\u201d\u00a0may have difficulty qualifying but can still apply with an endorser (also known as a cosigner).<\/p>\n\n\n\n The maximum amount you can get for a PLUS loan is the cost of attendance minus any financial aid you’ve received. <\/p>\n\n\n\n PLUS loans also have a fixed interest rate, which is a great advantage over other types of student loan funding. <\/p>\n\n\n\n\t\t Find the cheapest rate with one click<\/p> if you need additional funding for your studies you may need to consider taking out a private loan for your education. Many banks offer loans to graduate and undergraduate students, while parents can also take out a loan directly for their child, or co-sign for one. <\/p>\n\n\n\n Keep in mind that private lenders may require the co-signer to meet the institution’s lending requirements.<\/p>\n\n\n Private loans<\/a> are available to those who have good credit scores. The lender will need proof that you can repay the loan. You can qualify for a loan by having a co-signer. If you are unable to repay the loan, that person will take responsibility.<\/p>\n\n\n\n Private student loans are available to cover all costs associated with college. <\/strong>They can be originated by a bank or credit union, as well as an online lender. <\/p>\n\n\n\n Private student loans are less flexible for borrowers so make sure you exhaust all federal loans.<\/p>\n\n\n\n Federal student loans are not subject to credit checks, so they may be your best choice. Private lenders may offer loans for those with poor credit. <\/p>\n\n\n\n You will be assessed on other factors, such as your earning potential.<\/p>\n\n\n\n Private loans are often available to undergraduates who need a cosigner. However, lenders may require a co-signer if you do not have one. <\/p>\n\n\n\n Lenders will evaluate your ability to repay the loan based on factors other than credit history. This makes it more likely that you will be approved.<\/p>\n\n\n\n Both the federal government as well as private lenders offer graduate student loans. Before you apply for federal PLUS loans or private student loans, take advantage of the federal unsubsidized student loans.<\/p>\n\n\n\n Students who aren\u2019t U.S. citizens won\u2019t be eligible for federal student loans unless they are eligible noncitizens. To grant student loans to international students, private lenders often require co-signers who are U.S. citizens.<\/p>\n\n\n\n Although many states have their own loan programs they are more similar to private loans than federal loans.<\/p>\n\n\n\n Private loans are also available through community banks and credit unions. You may be able to get better terms and lower interest rates if you already have a relationship with one of these banks.<\/p>\n\n\n\n Prior to 1976, borrowers had the ability to discharge federal and private student loans in a bankruptcy. However, this changed with the introduction of the U.S. Bankruptcy Code in 1978.<\/p>\n\n\n\n To discharge a private student loan in bankruptcy, you first need to file for Chapter 7 or Chapter 13 bankruptcy<\/a>.<\/p>\n\n\n\n During your bankruptcy application, you’ll need to show that you meet the requirements for the undue hardship provision if you want to try and get your private student loan discharged through bankruptcy.<\/p>\n\n\n\n If you have a student loan in the collection, you could get it discharged through a Chapter 7 bankruptcy. It’s best to work with an attorney if you want to go this route.<\/p>\n\n\n\nHere’s what we’ll cover in this quick guide on student loans:<\/h4>\n\n\n\n\n\n
Types of Student Loans<\/h2>\n\n\n\n
Federal Student Loans<\/h2>\n\n\n\n
How Do Federal Student Loans Work?<\/h3>\n\n\n\n
Direct Subsidized Loans<\/h4>\n\n\n\n
Direct Unsubsidized Loans<\/h4>\n\n\n\n
Perkins Loans<\/h4>\n\n\n\n
PLUS Loans<\/h4>\n\n\n\n
Compare loans from 45 lenders<\/h3>
Private Student Loans<\/h2>\n\n\n\n
How Do Private Student Loans Work?<\/h3>\n\n\n\n
Bad Credit Student Loans<\/h4>\n\n\n\n
Student Loans with No Co-Signer<\/h4>\n\n\n\n
Graduate Student Loans<\/h4>\n\n\n\n
International Student Loans<\/h4>\n\n\n\n
State and Non-Profit Loans<\/h4>\n\n\n\n
Credit Union Loans<\/h4>\n\n\n\n
Bankruptcy Private Student Loans<\/h4>\n\n\n\n