If you have explored the qualifications for financial aid and it seems a student loan is your best option, you may find there are numerous choices available. Learn more about the types of loans available and how they work to determine which type of loan is the best option for you. Keep reading to see if Great Lakes student loans are your best option.
Federal vs. Individual Money
The U.S. Department of Education (DOE) recommends accepting free money first (scholarships and grants), then earned money (work-study), then borrowed money (federal student loans). If you have reached the point in your postsecondary journey when you are ready to explore loans, you may run into questions about federal and private loans.
- Government loans: Provided and guaranteed by the federal government
- Personal money: Provided via private sources, such as banks, credit unions, and states
The basic difference between federal student loans and private have a glimpse at the hyperlink loans is how they are sourced. The government provides federal student loans, while financial institutions like banks or credit unions source private student loans. However, there are other key differences as well.
Personal Figuratively speaking
For those who pursue college financing via private lenders, the procedure is relatively simple and can often accelerate the loan process. A bank, credit union, or online lender will provide a private student loan to qualified applicants.
There are a number of variables to consider when using a private lender to source a student loan. Borrowers need to be aware of associated fees, terms for repayment, interest rates, and possible options for pausing payments in instances of financial hardship.
A co-signer, such as a parent, may be needed to secure a private student loan if the borrower has not yet established credit. This can actually be a benefit to the primary borrower since a co-signer with good credit may be able to secure a better interest rate. Also, it ount than a federal loan, especially if they have excellent credit. Additionally, some lenders provide a “release clause” to the co-signer after a predetermined number of on-time payments have been made.
Government Student loans
Federal figuratively speaking are money that are sourced by the government. Normally, government student education loans was smaller strict to their approval criteria. Federal student education loans also have repaired rates of interest which might be place by Congress and place towards amount of the mortgage. Some federal money are subsidized, for example the us government pays the eye given that borrower is actually at school or around deferment, when you’re unsubsidized funds want your notice be distributed as soon just like the loan try acquired. Federal built finance are truly the only types of financing one promote many fees possibilities.
Higher Lakes is none a national nor a private education loan business. The firm will bring oversight and administration to help you both federal figuratively speaking and personal student education loans. High Lakes was established in 1967 inside the Wisconsin. It works with well over six thousand colleges and you may companion with over a lot of lenders. Great Ponds cannot originate people money of their own. As an alternative, Great Lakes acts as the newest mediator and you can guarantor between bank and you may debtor, already acting as one of the biggest student loan servicers.
Factors to consider When choosing a national Education loan
After completing your Free Application for Federal Student Aid (FAFSA), you will receive an award letter stating which types of student loans you have qualified for. It is highly advised that you have a sound idea of exactly how much you will need to borrow to fund your college experience so you can avoid over-borrowing when taking out your student loans.