Best College Loan Program

Q: For high school students who will graduate this summer, what is the best college loan program for first time college students?

A: Student loans for college can be broken down into two basic categories, federal student loans and private student loans. There are a few smaller sub-categories of student loans for college, such as peer-to-peer student loans, however, federal and private student loans are the loans that the majority of college students will utilize. In terms of the “best college loan program”, it is recommend that students first apply for federal student loans. Federal student loans for college will typically offer the lowest interest rates, most flexible repayment options, and are based on a students financial need, not on a students credit. Students can apply for federal student loans by filing a FAFSA, The Free Application For Federal Student Aid at www.fafsa.gov. To learn more about federal student loans for college, visit our Federal Student Loans Section and our Free eGuide: How To Pay For College.

Once a student has exhausted all of their federal student loan options (and are still in need of more money for college), many students will turn to private student loans. Unlike federal student loans for college, private student loans are offered by banks, credit unions, and other financial institutions. For private student loans, the “best college loan program” will depend on finding a private student loan lender that will offer you the lowest interest rate and best loan terms for your specific financial situation. Private student loans are based on credit history, so if you have poor or little credit history, you should plan on seeking the help of a creditworthy cosigner.