Start With The Safest Student Loans

One of the best tips for students new to navigating student loans for college, is to simply start with the safest student loans. What are the safest student loans? Federal student loans are the safest bet when it comes to student loans for college, and here’s why:

The Interest Rates: Federal student loans have interest rates that don’t change over time (fixed interest rates), and more importantly federal student loan interest rates are not determined by the borrowers credit score, but rather on the borrowers financial need. Federal student loans typically offer lower interest rates than any private student loans on the market. Borrower Protections: Federal student loans contain some guaranteed borrower protections, which can be a big help should the borrower fall into a period of unemployment or other financial problems after graduation.

Perkins and Subsidized Stafford Student Loans. These types of federal student loans are the safest and most affordable federal student loans. If you qualify for them, these student loans will be the least expensive student loans for the borrower, because the federal government pays all of the loan interest while the borrower is in school. The interest rate for Perkins student loans is fixed at 5%, and for Subsidized Stafford’s it’s fixed at no more than 6.8%. All students can apply for federal student loans by completing a FAFSA, The Free Application for Federal Student Aid. To learn more about FAFSA visit www.fafsa.ed.gov.