Obtaining a college education is becoming more expensive every year. Students are consistently gradating with more loan debt than students before them. This is an unsettling trend in education however, with the rising cost of tuition loans are many times the last resort. If you are in a situation where loans are you only option for paying for school there are some things that you should consider.
You will first want to decide what type of loans you want to take out. You have the option of going with Federal Stafford Loans, Private Student Loans, or both. Depending on how much you need in a loan, you may reach the maximum on the Federal Stafford Loans and be forced to take out a Private Student Loan. If you are at the end of your rope and forced to take out a private student loan you will want to carefully consider your options.
Private Student Loans are simply education loans that are provided by lenders independent of the Federal Government. Most major banks and lending bodies operate some type of education loan program. Some of the largest and most popular Private Loan companies are Sallie Mae, Wells Fargo, Nelnet, and Bank of America. It can be a daunting task trying to figure out which Private Student loans are best for you but there a few pieces of information that will help make your decision a lot easier.
You will want to consider the interest rate. Many Private lenders offer competitive interest rates but their rates are adjustable rather than fixed. This means that even though your interest rate is initially very low, it may balloon up in the years to come. You also will want to compare repayment options. Most private loan lenders will allow you to defer your loan payments while you are in school while some may not. If you are unable to begin repaying your loans while you are in school you should choose a lender that has an in-school deferment option.
Finally, you will want to check on the level of customer service provided by that lender. It is very important that your lender has a good reputation with their borrowers. If people have only bad things to say about the lender then chances are they are unfriendly to work with. You do not want this when you are having difficulties repaying your loans and cannot get anyone on the phone to assist you!
Private loans are a good option as a loan of last resort. With these helpful tips, hopefully you will have the tools to pick the best private Student Loan for you!