My Finance Blog

Life is hard nowadays. I can’t count the number of people who’d want to go to college but don’t have the resources to do so. Of course, they could work while studying but most often than not what they earn isn’t even enough for pocket money. Those who do get full scholarships sure are lucky. There are also those who get grants to help their studies, but most of the time, the grants only serve as supplemental money for the students. In cases like this wherein money is desperately needed to fund studies, a student loan might be in order.

How Does One Apply for a Student Loan

The first step is filing an application for student financial aid. There will be an agency which will assess your financial needs. You will then be required to supply all the details about yourself and your family.

The Types of Student Loans

There are many different types of student loans, here are two of them.

Guaranteed Student Loans

For this type, there are two subtypes to choose from. If you can prove that you are in dire need of financial aid and you pass the requirements, you are eligible for the subsidized type. A subsidized loan means the government pays the interest accrued of the loan while you study. If you don’t fit the bill for a subsidized loan, you can always get an unsubsidized loan. In this type, the interest is accrued and is not due for payment until your graduation.

Direct Student Loans

Many students prefer this type of loan because it, like its name, is direct to the point. The school or university is in charge or collecting funds for the student and the student is not obligated to pay until after graduation. Wherein which, a payment schedule will be set.

If during the allotted time for payment, the student fails to pay the loan, then that’s one big bad mark on the individual’s credit rating. But that’s a story for a different post.

Filed under: student loans