Student aid
The word student can be explained in different ways. It means school-going child, college-goers, management student or a student undergoing professional degree. In developed countries today almost all types of students can avail loan . There are many associations established in these countries that conduct various Student Loan Programs to different types of students.
The Federal Education Loan program is designed by the government to aid school students, college-goers and vocational students. According to Title IV of the Higher Education Act passed by the U .S. government, any student is entitled to receive federal loan . the private organizations or financial institutions in U .S. receive financial aid from the government. They in turn, provide it to the needy students in U .S.
A student who receives federal loan can cover many types of expenses such as school tuition fees, hostel rent, book costs and even traveling costs . There are some programs that can even provide finance to buy accessories such as computer etc .
The terms of Stafford Loan Programs differ from programs like FLEP (Family Loan Education Program) and Federal Direct Student Loan Program (FDSLP). If a student applies for Stafford Loan Program, then payment finance is directly paid to the schools and colleges where he has registered his name.
There are two types of Stafford Loans a) Subsidized loan b) Unsubsidized loan . Subsidized loan is repayable after completion of the degree or course along with the rate of interest . But if you buy unsubsidized loan, the interest of the loan is payable, when you are still undergoing the degree.
But there are some similar features about loan. both of them become repayable six months after completion of the degree . Both of them are provided to the students without even accessing the credit history and financial position of the student. But subsidized loans are usually paid to students who belong to a family with poor financial background.
The annual limits of both the loans is same i .e for undergraduates it is $3500 and for graduates it is $5,500 .
The other types of loans availed under the Federal Education program are a) Federal Stafford Loan b) Parent PLUS Loan c) Perkin ?s Loan d) Graduate PLUS Loan .
Under Parent Plus Loan Program, the parents of the students receive loan and the rate of interest is usually higher . Under Graduate PLUS Loan Program, the graduate get loan from the government at their own risk . Usually the financial position and credit history of the student is accessed here.
Perkins Loan is provided to graduates as well as undergraduates and the rate of interest of this loan is very low . There are many advantages of Graduate Loan Program. The procedure for obtaining the loan is easier. The rate of interest is competitive. Additional expenses or out-of-pocket expenses will not be incurred . If you are applying online, the procedure of preliminary approval will be completed in five minutes.
The terms and conditions of the loan are also liberal . The monthly payment is lower i.e. $25. The borrower will not pay pre-payment penalties.
The minimum amount that can be sanctioned to a student is $1,500 and the maximum amount that can be obtained is $1,30,000.
Other Articles
