Government Student Loans Information

At a time when a college education can cost tens or even hundreds of thousands of dollars, anyone aspiring to higher education might want to look in to their student loan options.  Believe it or not, one of your best options might be government student loans.  If you’re in this situation, you should explore the choices at both the federal and state levels of government.

As you are diving into a review of the various government student loans, think about the following questions for each program you look at:

• Who is eligible?  Most programs are targeted to undergraduates, although some are available to graduate students as well.  In addition, some programs focus on full-time students, whereas others provide funding for part-timers.  For each program, it is important to understand the eligibility requirements and how they relate to your situation.
• Financial need?  Some programs require the student to demonstrate a certain level of financial need, whereas others offer loans to students regardless of their overall financial status.
• Who is the lender?  Some programs offer loans direct from the government, whereas other programs are structured to offer guaranteed loans through banks and other financial institutions.
• What are the terms?  Two important things to look at are the interest rates and payback terms.  Most government student loans offer favorable rates (far more favorable than the commercial market), which will come in handy when you’re making payments after graduation. 
• Loan deferment?  You’ll also want to know if the loan you’re considering is eligible for deferment programs.  In some fields if you agree, for example, to spend a year teaching in a low-income community you may be able to defer your loan payments or even has some of your debt forgiven.

Federal Government Student Loans

The U.S. Federal Government offers a wide range of government student loan programs for those seeking a higher level of education.  Some to consider include:

• Perkins Loans:  Dependent on financial need.  Up to $4,000 a year for undergraduate and $6,000 per year for graduate work with a maximum of $20,000 at the undergraduate level and $40,000, including undergraduate loans, at the graduate level.  Available to part-time students in addition to full-time.
• Stafford Loans:  Not dependent on financial need.  Loan amounts depend on a variety of factors.  Interest rates and payback terms are variable.
• Parent Loans:  Finally, government student loans are available to the parents of college aide students.  The amount of the loan will depend on the amount of aide the student is already receiving as well as the cost of the school.  Students must be enrolled at least half-time. 

You can learn more about federal student loan programs at http://studentaid.ed.gov/PORTALSWebApp/students/english/studentloans.jsp .  In addition, a useful chart is available at: http://studentaid.ed.gov/students/attachments/funding/PerkinsLoanInfo.pdf

State Government Student Loans

Almost every state has its own student loan programs as well.  You can access information about these programs at http://www.students.gov/STUGOVWebApp/Public?topicID=24&operation=topic Here you’ll find a list of all 50 states (and the District of Columbia).  Click on any of the links to learn about the government student loan programs in that state.

Utilizing a combination of Federal and State government student loans, you’ll be on your way to a higher education in no time!