Student Loan Ultimate Guide 2023
There are several options for borrowing student loans, including federal student loans, private student loans, and alternative loans. Here is a brief overview of each type of student loan borrowing option:
Federal Student Loans
These loans are funded by the U.S. government and are available to eligible students to help pay for higher education. Federal student loans include Direct Subsidized Loans, Direct Unsubsidized Loans, Direct PLUS Loans, and Direct Consolidation Loans.
The U.S. Department of Education’s federal student loan program is the William D. Ford Federal Direct Loan (Direct Loan) Program. Under this program, the U.S. Department of Education is your lender.
There are four types of Direct Loans available
|Direct Subsidized Loans||Made to eligible undergraduate students who demonstrate financial need||Undergraduate students with financial need|
|Direct Unsubsidized Loans||Made to eligible undergraduate, graduate, and professional students||Undergraduate, graduate, and professional students|
|Direct PLUS Loans||Made to graduate or professional students and parents of dependent undergraduate students to help pay for education expenses||Graduate or professional students and parents of dependent undergraduate students|
|Direct Consolidation Loans||Allows you to combine all of your eligible federal student loans into a single loan||Any borrower with eligible federal student loans|
How much money can I borrow in federal student loans?
It depends on whether you’re an undergraduate student, a graduate or professional student, or a parent.
|Loan Type||Maximum Amount per Year||Eligibility|
|Direct Subsidized Loans||$5,500 to $12,500, depending on year in school and dependency status||Undergraduate students|
|Direct Unsubsidized Loans||$20,500 for graduate or professional students; $5,500 to $12,500 for undergraduate students, depending on year in school and dependency status||Undergraduate, graduate, and professional students|
|Direct PLUS Loans||Remainder of college costs, as determined by school, not covered by other financial aid||Graduate or professional students and parents of dependent undergraduate students|
Why should I take out federal student loans?
Federal student loans are an investment in your future. You should not be afraid to take out federal student loans, but you should be smart about it. Federal student loans offer many benefits compared to other options you may consider when paying for college:
Private Student Loans
These loans are offered by private lenders and are not backed by the government. Private student loans generally have higher interest rates than federal student loans and may have less favourable terms and conditions.
Here is the 12 Lenders providing Student Loans
These loans are also offered by private lenders and are not backed by the government. Alternative loans may be an option for students who have exhausted other sources of financial aid and are unable to obtain a private student loan. Alternative loans often have higher interest rates and less favourable terms and conditions compared to federal student loans.