Building a stable career can help keep debt away
Education has always been an important stairway to a bright career. Various types of vocational training programs are available for the students to help them build a brighter future. But though there are so many programs available, how many parents or students are able to avail them with the meager amount of money in their wallets? Not many! However, to solve this monetary problem there are different kinds of career building loans that are available for the students so that they can build their future career. You may take out such loans and utilize the proceeds to grab your degree but make sure that you do not pile up too many loans as this may force you to consolidate debt in the near future. As a student, you must always try to avoid debt so as to stop hurting your credit score. Have a look at the various loan options that you may take out to build a brighter future.
What are the Federal student loan options?
As the government or the US Department of Education issues the Federal loans, the terms and conditions on these loans are much favorable than the private loans. The government sets a low interest rate and nearly all students are able to take out such a loan and they also have a grace period after school during which no payments need to be made.
- Federal Stafford Loans: Anyone who has submitted a FAFSA is able to get this type of loan. There are two kinds of Stafford loans, subsidized and unsubsidized. The subsidized loans are all need-based loans and the interest rates do not pile up when the student is still studying. 6 months grace period is also given to the student so that he gets enough time to repay the loan after grabbing a job. The unsubsidized loans aren’t need based and you have to pay interest rates on these loans.
- Federal Parent plus Loans: The parents of the undergraduate and the students who are dependent can get such loans. The funds can be used for the entire cost of a student. The interest rates of such loans are set at 8.5% and therefore, if possible you can prefer some other types of loans.
- Federal Perkin’s loans: If you’re a needy student who is desperately looking for some financing options, this particular kind of loan is the best kind for you. The interest rates on such loans are fixed at 5% and they also share some particular characteristics of subsidized Stafford loans. You can also reap the advantages of no fees and a grace period.
Though the above mentioned loans can help your child complete his education and grab a good job, you must always remember that taking out too many loans may have a bad impact on your financial life. If you don’t get a good job and are unable to repay the loans, you’ll pile up debt and you may need to opt to consolidate debt. Therefore apply for the loans only when you know that you’ll be able to repay it with ease.