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Student Loan Directory
What kinds of federal student loans are available

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The Financial Aid Game

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The Financial Aid Game Troy Onink, 03.10.09, 06:00 PM EDT The sticker price of college is daunting. Here's how to pay less. The price of college, after growing faster than inflation for three d READ MORE
http://www.forbes.com/2009/03/10/college-fafsa-profile-personal-financ...
What kinds of federal student loans are available? Stafford loans are for undergraduate and graduate students. There are two types of Stafford loans: subsidized and unsubsidized. • Subsidized Stafford loans provide low interest rates and are available to students who demonstrate financial need based on income and other information provided on the FAFSA. A credit check is not required to receive these loans. The federal government pays the interest on these loans until six months after the student is no longer enrolled in school at least half time. • Unsubsidized S tafford loans provide low interest rates and are available to all students regardless of financial need (although the FAFSA still must be filed). A credit check is not required to receive these loans. The student is responsible for the interest, which may be paid while the student is in school or accrued and then added to the principal balance when the student enters repayment, which occurs six months after the student is no longer enrolled in school at least half time. Plus loans are low interest loans that parents can obtain to help pay the cost of education for their children. In addition, graduate students may obtain PLUS loans to help pay for their own education. PLUS loans require a credit check and, in some instances, an eligible cosigner. Repayment of PLUS loans begins following the final disbursement for the year. Graduate students may be able to defer repayment of their PLUS loans until after the student is no longer enrolled in school at least half time, although interest will continue to accrue. Consolidation loans allow student or parent borrowers to combine multiple federal student loans into one loan with one monthly payment. A federal consolidation loan cannot include private loans. However, some private lenders may offer consolidation loans. Borrowers should be aware that they will lose their federal borrower benefits if they consolidate their federal student loan into a private consolidation loan. Borrowers should always exhaust federal student loan options first before considering a private consolidation loan. • Allow students and their parents to borrow money to help pay for college through programs supported by the federal government. • Offer lower interest rates and better repayment benefits and options than private student loans. • Are available to students and parents who need help paying for college—in many cases, regardless of income level or credit history. Students and parents should always exhaust federal student loan options first before considering a private loan. To apply for a federal student loan, complete our online tool, the Free Application for Federal Student Aid (FAFSA), at www.fafsa.ed.gov. For additional information on the federal student aid programs, consult the Department of Education’s free publication Funding Education Beyond High School: The Guide to Federal Student Aid, which may be obtained by visiting www.federalstudentaid.ed.gov/pubs or calling 1-800-4-FED-AID. Federal Student Loans
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