There are various types of loans that may be available to you if you qualify. Some of the most popular types of loans include student loans, personal loans, payday loans and car loans.
Learn more about these popular types of loans here.
Student loans are a type of loan designed to help students pay for education and the fees associated with education, including supplies, books, tuition and living expenses. Compared to other loans, student loans offer substantially lower rates of interest. Additionally, the repayment schedule can be deferred while students are still in school.
There are two main kinds of student loans in the United States: federal student loans and private student loans. Private student loans come from lenders such as banks, while federal student loans are funded by the U.S. government.
Most experts recommend federal student loans over private student loans. Why? By law, federal student loans must include certain terms that benefit borrowers, like fixed interest rates and income-driven repayment plans.
For private student loans, the terms are set by the lender, so you are unlikely or at least not guaranteed to get these same benefits. You will most likely end up paying more money while repaying private student loans than you would repaying federal student loans.
Federal loans can be unsubsidized or subsidized. On subsidized loans, the government covers the loan interest payments while the student is in school. They are generally preferable to unsubsidized loans, which requires the borrower to pay interest at all times.
If you have student loan debt, you may be able to refinance your debt. This may give you a lower interest rate and save you money in the long run or on your monthly payments.
Pros: They can help you get that degree you are aiming for.
Cons: You may end up starting your new career with a considerable amount of student loan debt.
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