Best student loans can make a huge difference for all those students who find it difficult to cover their tuition fees and housing costs through savings and scholarships. In fact, the best student loan options are offered by the federal government.

A student loan actually refers to the amount that you borrow from any bank or non-banking company for the purpose of your post-secondary education, and you agree to pay back over time with a fixed interest rate and other fees. It is important for you to learn that your payback amount for a student loan will always be greater than the actual amount that you borrowed due to the accruing of interest over the life of your student loan. Determining the additional amount to be paid for your requested loan amount mainly depends on the interest rates as imposed by the lender on your loan amount. Today, most of the college students prefer best student loans to cover their educational costs. So, in addition to exploring scholarships and grants to afford your university fees, you can consider applying for student loans in order to obtain the required financial support.

Before you decide on taking student loans to cover your tuition fees and other costs, it is imperative that you learn about the two main types of student loans: federal student loans and private student loans. Explained below are the essential features of both types of student loans.

• Federal Student Loans – Federal student loans are the best student loans that are offered by the federal government. Students can easily explore their federal student loan options by filling out the FAFSA (Free Application for Federal Student Aid) form and qualify for scholarships, grants, federal student loans, and different federal work-study programs. As a matter of fact, these loans are funded by the government and hence, they come with fixed interest rates and multiple repayment options. On the other hand, many private lenders offer private student loans with relatively higher interest rates and fewer repayment options. Unlike the private loans, federal student loans are not based on the credit scores and worthiness of borrowers and co-signers.
• Private Student Loans – In case you have exhausted your federal student loan options and you still need money for your college tuition fee and other costs, then you can start looking for private lenders to offer you with best student loans, thereby backing up your studies financially. Just like the federal government, private lenders offer private loans to the students who are in need of money for covering their college costs. Unlike the federal student loans, the interest rates of private student loans are based on the credit history of the co-signer. Private lenders may also study your financial information in order to approve your private student loan.

Now that you’ve learned the difference between federal student loans and private student loans, let’s discuss how you can apply for best student loans and take out the financial aid. In order to apply for a student loan, the student is required to submit an application to the lender through the FAFSA process. The FAFSA process takes around 60 minutes and once you have completed FAFSA, the applied school will review your provided information and send a financial aid packet describing the scholarships and loans for which you qualify. It is important for you to know that the federal government has a pre-defined limit on its federal student loans, grants and scholarships. So, in case you stay short of funds, then you can easily apply for private student loans.

As a matter of fact, private student loans are the best student loans because they offer additional support with adequate financial opportunities to cover the gap. Most of the private lenders have their own application forms and they’re the one who decides whether a student qualifies for a private student loan or not. Eligibility criteria for private student loans include the student’s enrollment status, type of degree program, and year in university or college. These criteria may also include the co-signers credit scores, credit rating, and debt-to-income ratios.

Student loans are sanctioned for a particular time period and therefore, it is imperative that students repay for their student loans. In some cases, the repayment process of student loans starts with the students still being enrolled in college. In other cases, the repayment process starts after the students complete their post-secondary education or drop before half-time enrollment. Although a grace period of 6 to 9 months is being offered to the students before starting the loan repayment, it is also essential for students to undergo exit counseling before leaving the school. Exit counseling is meant to offer the essential repayment information to the borrower alongside collecting necessary details like the name of borrower’s employer, current mailing address etc. It is actually the responsibility of the borrower to ensure that delivery of up-to-date contact information and other essential details to the lender. Students can also opt for income driven repayment options in case of low income.

With the best student loans, students can easily support their tuition fees and other academic costs and complete their post-secondary education in a hassle-free manner.