Need extra money for education? You may qualify for other government assistance with low interest rates.
Education grants can potentially cover most of your tuition if you meet the requirements. But if you need some additional financial help to cover some college costs, the government also provides safe student loans that you can get access to by filling out the FAFSA online.
- Direct subsidized loans: Also known as a subsidized Stafford loan, what makes this option special is that the government covers the interest payments. Qualifications include being an undergraduate and having financial need.
- Direct unsubsidized loans: You don’t need to be in financial need to qualify for an unsubsidized Stafford loan. Also, both undergraduate and graduate students qualify. With this option, borrowers need to pay the interest and the school determines how much you can borrow.
You can borrow between $5,500 and $12,500/year as an undergrad or up to $20,500/year as a graduate student.
Additionally, getting a federal student loan from the government offers some competitive advantages:
- You get a fixed interest rate that is lower than average rates on private loans.
- Repayment options are flexible if you’re having financial trouble.
- Partial student loan forgiveness is available if you get certain jobs after college.
One advantage you have with federal student loans is that after you graduate college, you get a grace period after you graduate before you have to start repaying them and that will vary depending on the loan that you have.
Also, repayments are more comfortable than with normal loans because they can adapt to your income once you start paying them, and providers also make them much easier to manage. The idea is that the repayments are affordable based on how much money you make and how big your family is. If it is the case that you can’t pay them, you may have options like forbearance or deferments to help you out.
Repayment plans available include:
- REPAYE (Revised Pay As You Earn repayment Plan)
- PAYE (Pay As You Earn Repayment Plan)
- IBR (Income-Based Repayment Plan)
- ICR (Income-Contingent Repayment Plan)
You can fill out an application form to enroll for these plans and take advantage of these easy repayment options.