Private vs. Public
Student Loans for College

Applying for and accepting student loans for college should be a last resort after exhausting all other options to find money for school.

Once you’ve exhausted every other financing option, then it comes time to really understand what your choices are in the way of public and private student loans.

Student Loans for CollegeDon’t accept another student loan until you’ve read and reviewed this student loan page and you completely understand the obligation that you’re about to enter into.

Accepting any student loans just willy-nilly can mean the difference between paying thousands more to repay the loan and also the difference between having to begin paying for it tomorrow or after graduation.

Public Student Loans vs. Private College Loans

A public student loan is one that is backed by the government and requires that you file the FAFSA in order to be considered. There are several types and you need to know how each one can affect you and your future.

These loans are the most favorable to attain and typically offer more benefits to the students than do private loans. These are also referred to as Title IV loans.

A private college loan, like the Sallie Mae college loan, is one that’s attained through a private bank or any other private financial institution. You can’t apply for private student loans through the FAFSA. Each financial institution will have its own application for private college loans that’ll need to be filled out.

Private college loans require lots of due diligence and scrutiny from parents and students when it comes to looking at these types of loans. These can typically be the least favorable to parents and students if you’re not careful.

Learn more about your private college loan options.

Understand Public Student Loans for College

Subsidized Stafford Loans
These loans are guaranteed by the federal government and are based solely on financial need. Interest doesn’t accrue on these loans while you’re in school.

The government makes the interest payments on these loans while you’re in school and during any future periods of deferment up until the time you’re obligated to begin paying back the loan.

The government no longer pays the interest during deferment periods on these loans issued after July 1, 2012. Learn more...

Unsubsidized Stafford Loans
These student loans for college are also guaranteed by the federal government and interest does begin to accrue immediately after the loan is issued to the student.

Students don’t need to begin paying off these loans until 6 months after graduation which includes having to pay back the accrued interest since the issuance of the loan. Learn more...

Perkins Loans
These are low interest loans distributed by the colleges and universities that choose to participate in this program. The funds that the school carries for these loans is backed by the federal government and are used for some of the most extreme financial need situations.

They have rules that help the students with difficult financial circumstances to find ways to make it easy to pay back what they borrowed through this program. Learn more...

PLUS Loans
These are low interest student loans for college backed by the federal government paid to parents to assist in paying for the cost of a student’s college education.

These loans begin to accrue interest upon issuance of the loan and payments to repay the loan begin immediately after the loan is issued. There is no cap on the amount that can be borrowed only up to the amount needed to cover the student’s tuition, room and board, fees and any other authorized college expenses.

These direct federally funded student loans for college are always paid directly to the school. Learn more...

You may not always have a choice as to what loan is awarded to you, but you do have a choice as to whether you want to accept a student loan.

The choice is always yours as to any loans you accept or deny. Always be sure that you understand your obligation when you accept and sign a promissory note. Be sure you’ve exhausted all other options that can help you pay for college.

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