The most common type of student loans that you can avail for your college education are government student loans. These loans have very low interest rates as the purpose of these is not to gain profit but rather to help citizens who are financially incapable to get higher education. You can use these loans to finance your tuition, books and college supplies, lodging, food, and other expenses that you may need while studying. Government student loans can be paid after graduation, after a period of about 6 months wherein ideally the individual already has a stable source of income.
Government student loans are different from private student loans because they are usually subsidized by the government. Because of this, you don’t have to pay the interest while you are still studying as the government will shoulder it for you. They have also very flexible terms so you won’t be put in a tight spot paying for them after you have just gotten your first job from graduation. However, they can only be availed on schools that participate in government aid programs.
In addition to that, government student loans doesn’t usually look at your credit rating for you to qualify a student loan, unlike private student loans. But you have to meet certain qualifications for socioeconomic status and the income of you and your parents. This is because government student loans are specially created for people who do not have the ability to pay their college expenses. Another limitation of government student loans is that it has a lower cap limit than private student loans. So if you are eligible for government student loans, it is best that you avail of it first before acquiring private student loans.
In the United States, there are several types of government student loans that you can avail of. These include Stafford Loans, Perkins Loans, PLUS Loans, and the Federal Consolidation Loan. You can also borrow directly from the Department of Education through the Federal Family Education Loan Program or FFELP. To avail of government student loans, you must first complete the Free Application for Federal Student Aid or FAFSA so that you can be deliberated for federal aid.