If you are in need of Financial Aid, federal student loans offer less risk and provide the same loan rates and terms for everyone. If federal student loans are not enough to cover the cost of your education, you may need a private student loan to cover these expenses. Below are 6 things you should know before committing to a private college loan.
1. Turn to E-Student Loans at www.e-student-loans.com.
2. Check for schools that have their own credit unions that offer private college loans. If your school is affiliated with a credit union, check its rates. Here are institutions that have a credit union:
3. Apply for Multiple Private Student Loans.
4. Don’t assume you’ll get the lowest private college loan rate.
5. Ask the right questions.
Before committing to a private student loan, ask these questions:
1. What is the interest rate?
2. Is the rate fixed or variable?
3. Is there an interest-rate cap?
4. What is the total cost of the loan?
5. Does the loan have borrower rewards?
6. What are the student loan deferment options both during and after school and are there any hardship waivers?
7. Are there any additional fees?
8. How difficult is it to consolidate loans and cut interest rates after graduation?
9. Does the loan offer penalty-free pre-payments?
10. How long is the grace period?
11. What are the borrowing limits?
6. Borrow responsibly.
Don’t borrow too much. Of course, college is a great investment, but you don’t want to overextend yourself by graduating with too much student loan debt that you cannot afford to pay. It’s much easier to borrow too much through private student loans because they have higher borrowing limits.