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Subsidized Student Loans Information & Progam To Use

August 27, 2011

Subsidized Student Loans

Before we get into some of the great program that offers subsidized student loans, we will overview exactly what it means, if you already know, feel free to skip to the section where it talks about these great lenders. Anyways subsidized student loans are there for you when your other financial aid options aren’t providing enough funds to cover your tuition costs. This isn’t the only benefit of subsidized student loans as the interest on these loans are paid by the government or a third party lender, which means the interest will not stack up on you when you are in college, and you will never have to pay this money back, as well as do not require payments until college is over, where compared to subsidized loans where you will have to pay interst while in school.

subsidized student loans

Subsidized student loans are usually provided on a needs basis, meaning that those who need them most tend to get them the most which can be in the case of low income, and certain areas of residence, or just not enough funding from other sources like grants, scholarships or help from family, etc. The low income requirements have shown it to be that 50 percent of subsidized student loans go to those who have an house income level of 50,000 or below, 25 percent for 50,000 to 100,000 and 10 percent to over 100,000. Subsidized student loans also require that you are enrolled on a half time basis in order to keep receiving the benefits that were mentioned above. The great thing about subsidized student loans is that they are not credit based and you do not have to require a cosigner, you can even get subsidized student loans with no credit history at all.

Subsidized Student Loans - The Program To Use

When it comes to the subsidized student loan program to use, it is a federal, or government funded programs, that can assist you, as well as provide eligible applicants with great benefits. Also with these being federal programs, they offer much lower interest rates compared to private programs. Here are two great federal options to use for your subsidized student loan.

Stafford Subsidized Student Loans

  • This option provides its eligible candidates with fixed interest rates, meaning that they will never change, which are as low as 4.50 percent. So for example say you take out a 20,000 dollar loan at 4.5 percent. You will end up paying 900 dollars back in interest on top of the original 20,000 dollar debt. This program has a repayment period which is 10 years, although it can be extended in some cases, and also allows you to borrow enough to cover what your other programs aren’t covering.

Perkins Subsidized Student Loans – Qualification

To qualify for these subsidized student loans through the programs mentioned above, you will have to fit the following criteria:

  • Be a citizen of the USA or be able to prove that you are a permanent resident.
  • Complete a FAFSA application, which stand for Free Application for Federal Student Aid.
  • The completion of at least your highschool education or something equivalent, like a GED.
  • You are not defaulted or have a delinquent account with any other federal lender program.