Student loans : Better than credit cards

You need some more money for college expenses this semester, surely student loans. Do you whip out a credit card to pay for your books, or do you apply for a federal or private loan? Well, consider the options -

• With a federal loan, your interest rate will be low (around 5%) and your payments will be deferred until 6-9 months after graduation.
• With a private college loan, the interest rate will be slightly higher than with a federal loan but will still be lower than average. In addition, you will only need to make interest payments until after graduation.
• With a credit card, on the other hand, the interest rate can be as high as 21%. Interest begins accruing almost immediately, and you need to begin paying off the bill the next month.

This is not to say that credit cards do not have a place in your college life. It is good to have one national card (Visa, MasterCard, Discover) on hand to help you build a positive credit history and to provide security in emergencies.
source:http://www.nextstudent.com

College student loans

Car loan for college students provide financial assistance to individuals who have little or no credit. Information on a car loan for college students can be found through many online financial sites. This service often requires high interest rates because of the individuals lack of credit history. While funding may be hard to receive, a cosigner makes the probability of receiving assistance much more likely.

Receiving a College student loans with debt and little credit is often rare, but many financial companies with websites do provide this option. Often banks and other financial institutes will not approve car loans for college students because most students have no credit or collateral to back up the loan. Since websites have more offers in this situation than others will provide, students have the option to seek assistance online, but must be aware of the lenders before agreeing to anything. Young adults can sometimes be naive or overly excited in situations and make decisions without properly thinking them through.

In situations where an individual is financing their education and they have little or no credit, the rate of interest is very important. With little or no credit, it is very difficult to receive a low interest rate on a college students car loan. Also, having no collateral can hinder the individuals abilities to receive lower interest rates on any type of funding program.

One of the best options to pursue when seeking a car loan for college students is to use a cosigner. By asking a parent or guardian to cosign the loan, the individual can receive the funding to purchase a vehicle and possibly lower interest rates if the cosigner has a good credit rating. This is an excellent way to assist someone in receiving car loans for college students and still give the student the responsibility of making the monthly payment.
source:http://onlineloans.blog.com/

Private College Loans

At least 20% of college students need some type of loan to help pay for their college education. Such a statistic can lead to students graduating with an unmanageable debt load. An alternative is for parents to help out by taking out loans themselves. But which is the better option - college student loans or parent loans? Each has distinct advantages and uses.

Federal student loans have the lowest interest rates and best repayment options. If you need to take out loans and you qualify for federal loans, this is your best choice. Just be sure to accept only the funds you need, even if you are offered much more. Parents can always help their children pay off these loans once repayment begins after graduation.

Parent Loan for Undergraduate Students are another loan option that comes with low interest rates. If you are a parent with dependent students attending college at least part-time and you have a good credit history, you are eligible to receive a PLUS Loan. These loans are not needs-based. You can borrow up to the total cost of undergraduate education expenses, minus other financial aid already received. Unlike federal student loans, payment is not deferred until after graduation; instead, your first loan payment will be due about 60 days after the loan is disbursed. Also unlike federal student loans, PLUS Loans require an application fee.

Both students and parents can take out private college loans to cover funding gaps. Terms are basically the same for these loans, although students may be able to have their repayment deferred until after graduation. Another consideration is that students may wish to take out small loans to begin to establish a credit history. You may need to cosign for private student loans.

Parents do have some additional options for college funding, such as home equity loans. These often have rates as good as private loans.

source:http://nextstudent.com