Us department of education consolidating student loans
Many subsidized loans also come with a few guarantees about costs.
The latest Congressional agreement, reached in the summer of 2013, ensures that the rate a student agrees to at the beginning of the loan period stays in place for the life of the loan, according to an analysis performed by Subsidized loans can be of benefit to students, but there are some things to watch for.
Those who can obtain a loan like this often see remarkably low interest rates that stay steady for the life of the loan, with no interest accruing during the time the student spends in school. It’s easy to see how obtaining a subsidized loan might help a family to save money.
Since interest doesn’t accrue while the student is in school, the student enjoys an effective zero percent interest rate for several years. In addition, as mentioned, these loans often have interest rates that are much lower than a private student loan.
With a variety of student loans, some private, some from the federal government, and even more from state governments and some from colleges themselves, it’s hard to keep track and understand what the best financial options are.
Fortunately, there is one loan option that stands out above the rest as a clear best bet, once a student and his or her family has determined that they must borrow to cover college costs: and that option is a subsidized student loan.
Those students who do qualify can see a deep discount on the interest rate they’re asked to pay.Most of the requirements are covered in the FAFSA, and it’s important for students to be honest in their enrollment paperwork, as the officials do check each point provided and ensure that it’s accurate.The financial need component of the picture is vital, as these loans are designed to go to students with demonstrated financial need.The Perkins loan program is much smaller than the Direct loan program, and is designed to assist students from notably low-income families. Department of Education indicates that about 1,700 institutions participate, but that leaves many more that do not.These loans are also processed through the schools the students attend, not individual loan providers, and not all schools participate in the Perkins program. Eligibility for this program is once again determined by the answers a student provides on a FAFSA, and the student is provided with enrollment paperwork if the proper need can be demonstrated and supported.