Benefits of Federal Student Loans & Programs to Use

August 27, 2011

Benefits Of Federal Student Loans

Before you put your schooling on a credit card or go through a private organization to get student loans, you must read this article about the benefits of federal student loans, which many professionals advise against putting your tuition costs on credit cards as there are often heavier interest and other fees that apply. Below will be 6 different benefits that federal student loans bring to their eligible applicants, as well as how to obtain one through a quick and easy process.

Federal Student Loans & Programs

Federal Student Loans – 6 Benefits

  1. Being that we are using the word loan, students obviously want to get it paid off ASAP. With all federal student loans programs, they will never penalize you for paying higher than the minimum when it comes to monthly payments, unlike many other private organizations.
  2. With federal student loans, there is the opportunity for you to do what is called a “debt forgiveness” where you will be provided the opportunity to work a public service job where you will get your entire debt knocked out on what is left after you pay 120 payments, or 10 years, regardless of how much is left. If you choose to go into a debt forgiveness program, you will be granted the opporunity to only have to pay 15 percent income on your monthly debt bills.
  3. The interest rate that you establish on day one will never change. Federal student loans programs all offer fixed interest rates that never change, no matter what.
  4. With federal student loans, you actually get the freedom of choosing how long you with to pay off your loans. There is the main way of paying over a 10 year period, which will present you with high monthly rates but a lot lower interest payment, or you can choose one that starts out low and increases over time, and lastly you can choose to do things based on what your income will let you do, letting your have a program that will allow you to pay what you can afford each month.
  5. You can also consolidate federal student loans unlike with private lenders. This means that you can take all of your loans and put them into one loan program that will allow you to both have just one payment as well as give you the possiblility to save money in the short and long run by just paying one company instead of multiple.
  6. They also have deferment options, which basically means if you miss a payment or make a late payment, you will avoid delinquency by entering into a suspension program, allowing you to regroup financially and get your payment ready for the next month.

Three great federal student loans you can use are these programs:

  • The Perkins Loan
  • The Stafford Loan
  • The Student PLUS Loan

Benefits of Federal Student Loans – How To Get A Federal Loan

So now that you know the many of the benefits when it comes to taking out federal student loans, you can now decide whether you want to go with the method or not. If you do choose to, the first thing you need to do which should be done as soon as humanly possible is to fill out a Free Application for Federal Student Aid (FAFSA). Once you fill this out, you will be notified of which federal student loans programs you are eligible for if any

Category: Federal Student Loans

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