Four Student Loan Types and How to Get Them

Those entering their final year of high school have a lot to think about. Where do I go from here? What college can I attend to achieve my goals? And while discovering the answers to these questions is hard enough on its own, so is finding the financial means to make those answers into a reality. College these days is not cheap - even if you go to state-sponsored colleges - and often the only choice you have left is taking out a student loan. Luckily the government and banks have created several options.

Types of Student Loans

Generally speaking, there are two types of loans that you can take: federal loans and bank-sponsored private loans. Each has its advantages and disadvantages, but both types of loans can help pay for everything from books to living expenses to basic tuition and fees.

Any of these student loans that you choose to take carries the same repayment agreement. That is, you do not need to pay back a student loan, public or private, until 6 months after graduation. Also, the interest rates are very low and in some case fixed, allowing for a better prediction of your financial obligations after school. Taking a student loan to pay for college is clearly the way to go and there are four major options that you can consider.

Federal Stafford Loan

The most popular loan taken by college students is the Federal Stafford Loan which comes in both subsidized and unsubsidized forms. The subsidized Stafford Loan does not begin to accrue interest until after graduation whereas the unsubsidized version does accrue interest while you are still in school. The interest rates on Stafford Loans are low and fixed and they are available directly through the Department of Education. Whichever school you ultimately choose will help you get this loan through their Financial Aid office. Stafford Loans can be given up to the amount of $20,000 each school year. They are available to anyone who wants one, though subsidized loans are given based on financial need.

Federal Perkins Loans

The next option is a need-based loan also sponsored by the Federal government, the Perkins Loan. This loan is only available to those who meet certain criteria in terms of income (and parental income) and a standard formula will be employed by your college's financial aid office to determine what amount you qualify for. Because of the nature of Perkins Loans, which are given on a first come, first served basis, and the special needs-based formula, it is important to apply for these loans early.

Federal Plus Loans

The Federal Plus Loan operates much like the Perkins Loan, in that it is need-based. However, rather than being taken out by the student, Plus Loans are given to parents wishing to pay for their child's college education themselves. Plus Loans are determined based upon the parents' financial situation and income in addition to how many children they have attending college.

Private Student Loans

The final option is student loans provided by private banks. These lenders - who also serve other loan needs such as home and car loans - review your FAFSA form and then provide the amount of money that a student or parent needs. These loans are generally used when Federal options are insufficient to pay all college expenses, such as at private colleges, and will be determined based on the same criteria that the financial institution uses to make any personal loan. These loans generally do not carry a fixed interest rate, however, so it is important to exhaust the federal options first.

Taking a Loan

Going to college is a really big step in a young person's life, but so is taking a student loan. Make sure that you understand all repayment obligations before you take money for school as failure to repay student loans can negatively impact your credit in the future.

How to Find Fast Loans For Students

How to get an 'Education loan'

The cost of education is getting higher day and day. To solve this problem, banks provide 'Education Loans' to all deserving students so that further studies become a good learning experience. Getting an education loan granted can be quite easy and one can apply online also for it.

To take an education loan from a bank, a student should take the following steps:

Step 1: Take the student loan application form from the bank and fill it correctly.
Step 2: Have a personal discussion with the bank authorities.
Step 3: Provide correct supporting documents to the bank with your signatures on them.
Step 4: Get a guarantor.
Step 5: Student signature on Promissory Note.
Step 6: Sanctioning of the loan or disbursal of the loan to the student.

All the above six steps have to be followed by the applicant. Now let us discuss each step:

Step 1: Loan Application form from the bank

Just as for all the other kinds of loans, for an education loan also the banks provide an application form to the applicant which has to be filled correctly. The bank will ask for personal details and all information related to the course for which one is applying. Make sure the information is accurate and can be easily verified. This information will help the bank to process your application faster.

Step 2: Personal Discussion with the bank authorities.

Once the applicant has filled the form, the next step is the discussion with the bank authorities. In this stage, the applicant is asked about his/her academic and extra-curricular performance. At this stage, it is very important to be lucid and clear about one's selection of the course and its potential of generating income in the future.

Step 3: Provide correct supporting documents to the bank with your signatures on them

In case of education loans, the documents related to admissions are mandatory even before the bank considers the loan application. The bank will verify on every step of the enrollment of the student in the concerned institute in which he/she is studying. One may also require collateral security such as papers related to any property to be mortgaged if the loan amount is above 4 lakhs (INR).

Step 4: Get a guarantor.

For an education loan, a guarantor is mandatory.To get a loan approved there should be a person who takes the responsibility for the repayment of the loan in case of any mishap. The guarantor could be the applicant's parents or guardians. The bank will run a thorough check on the guarantor's credit history before sanctioning the loan. After the completion of the process, the loan may be sanctioned or denied.

Step 5: Student signature on Promissory Note

While the parents/guardians are guarantors, the student is the actual borrower of the loan. Once the loan is sanctioned, the student has to sign a promissory note to the bank.

Step 6: Sanction of the loan or disbursal of the loan to the student

Once the paper work formalities have been completed, the bank will surely disburse the loan into your account or deposit the fee directly into the account of the concerned college/institute.

All the above 6 steps will surely help you to understand the process of education loan. Once the loan has been approved you may contact the Admission Times for the further process.

If you are looking forward to going abroad for higher studies, 'Admission Times' based in New Delhi will help and guide you through the complete education loan procedure.

Securing Start Up Loans With Bad Credit: How To Make It Happen

The financial world has changed dramatically in recent years. With so many people having lost their jobs, many are forced to establish their own source of income and set up businesses. But with the costs involved, is it possible to get a large enough start up loan with bad credit?

Lenders are naturally cautious, and given the financial collapse that many parts of the world have suffered since 2008, the number of opportunities should have fallen. However, to the right applicants, the opposite has occurred, and securing loan approval with poor credit history is a real possibility.

What matters is that the application is strong, and the right loan is applied for from the right lender. Getting a start up loan that is not just enough, but is also affordable, can be a challenge. But there are some points that need to be considered in advance.