Education Articles from College Matching Service

Federal loans are provided by the government for the higher education needs of prospective and current students. These loans generally have low interest rates and the rules and regulations are created by the United States Department of Education.

Some federal loans are:

I) Stafford Loans: These are given to both undergraduates as well as the graduates. This loan comes in both subsidized and unsubsidized forms. While you get the subsidized loan on the basis of need, the unsubsidized loan comes to students who need additional aid. This comes with interest.

II) Perkins loans: This is also a subsidized loan for both the undergraduates as well as the graduates. In this case the college is the lender using its own pool of money. The loans are awarded if there are exceptional financial needs.

III) Parent PLUS Loans: These loans are given to the parents of the students to supplement the financial need of the students.

IV) Grad PLUS Loans: These loans are for students who are enrolled in a graduate or a professional program

V) Federal Direct Loans: These are provided by the US Department of Education directly to the students after careful assessment of a student’s need.

These loans which are provided by the federal government are different than corporate loans. Corporate loans offered by various banks and other institutions. These are paid directly to the student as opposed to directly to a college or university.  This add flexibility to the prospective student to allocate the funds according to their needs.  Some common private loans are:

Wells Fargo Collegiate Loan

I) Citi Assist Loan

II) CLC Premier Loan

III) CLC Bar Loan

IV) Law Access Loan

V) Wells Fargo Education Connection Loan

VI) Sallie Mae Signature

VII) Wells Fargo MedCap Loan

If you are applying for any corporate student loan, there is something to keep in mind: corporate loans cannot be consolidated with the federal loans. You need to take them separately and also pay for them separately.  With these things in mind collect your research and carefully make the best decision for the loan that fits your education needs.

In certain cases you may need to have some form of student loan to cover up for your college education expenses. In fact according to research almost two thirds of all student aids comes from federal loans. But before you go for a corporate student loan there are some things that you need to research. These are:

a) Whether it is given to both undergraduate as well as graduate students

b) Whether checking the credit status of the students is a factor

c) Whether the rate of interest is lower than the interest rate offered by other organizations

d) Whether or not you can defer payment until after you have completed your program

e) Whether the interest rate is fixed or not

After checking these out you will be ready to pursue a corporate or federal student loan. Some benefits attract students to corporate loans rather than the federal loans. The benefits are:

i) No borrowing limit on the money

ii) Good interest rates and fees

iii) No application fees

iv) No deadline for applications – you can apply at any time

v) A grace period of 12 months after graduation

vi) Quick approval of loans

vii) Money is sent directly to you and not to the school

viii) Immediate disbursement of the loan within 48 hours of loan approval

ix) If you pay back on time then you would get 0.5% discount on interest

x) No need of having a federal loan application at your disposal

xi) If you have a cosigner with you then you would get the loan at much lower interest rate

However there are risks involved in these corporate student loans also. First you need to know very clearly what are the terms and conditions that you need to fulfill before you go for the loan. Secondly you need to understand whether these loans offer same protection like the federal loans.