Department of Education Student Loan – Paying for the school fee is a huge burden, especially when the cost of college fee increases. The public universities are much cheaper option over the private schools.
When you are at school, student loan, service plays a critical role. These entities need to maintain account records of the borrower, periodic statements advising borrowers about the balance due.
The higher education cost more than ever, finding an affordable financing option is essential. The Federal government is one of the best places to start.
Department of Education Student Loan
- Direct Subsidized Loans
This is one of the best options to get the finance to pay your school fee. The Department of Education pays the interest that accrues when you are in school. During the grace period after graduation and if you put your loan into rescheduling.
If you are responsible for paying the interest, the rates are low. The interest rate is 4.45% interest rate. This loan is available to Undergraduate students with financial need. The government issues this loan, but the college decides that you meet the eligibility and the amount you can borrow.
- Direct Unsubsidized Loans
This loan is available for graduate as well as undergraduate students. It is another option to pay for your school. The interest rates for the Unsubsidized loan interest rate for an undergraduate student is 4.45% and 6% of the graduate students.
To qualify for an Unsubsidized loan, you need to enroll at least half-time in school. Unlike subsidized loans, you don’t need to show the financial need to be eligible for a loan.
- Parent Plus Loan
In order to help the students, some department of education student loans is available. The interest rate for this loan is 7% and one can borrow up to the total cost of attendance less any other financial aid your child receives.
One can borrow up to the total cost of attendance less any other financial aid your child receives. You need to pay the disbursement fee 4.264% of your total loan. Since this loan is in the name of the parent so they are responsible to repay this loan.
- Direct consolidation loan
In case you are juggling multiple loan services and payment due dates it can be stressful. To simplify this you need to consolidate them into one loan using direct consolidation. Combining your loan with a direct consolidation will provide you access to more IDR plans and even help you qualify for PSLF.
The interest rate is based on the weighted average of the rates on your old loans. You must be able to extend the repayment term and reduce your monthly payments.
- Grad Plus Loans
If you are a student and going to graduate school/pursuing a professional degree at least halftime. You can qualify for this loan, the interest rate for this loan is 7% and you require a credit check.
This loan is beneficial as compared to the parent plus loan. It is for all IDR plans and qualifies for PSLF without requiring to be consolidated beforehand.
Going through the above information you can find which loan is suitable for your requirement. You can easily check the eligibility and select the option which is perfect for you.