Subsidized Student Loans - For a Brighter Tomorrow

2007-03-08 10:33:40

( Financial )



Getting a college education is admittedly hard, for anyone. It entails enormous financial strain. Tuition fees are not getting any cheaper. And books as well as laboratory expenses are not far behind. But if you decide not to get a degree because you just don’t have the capacity to pay for it, then you might be selling yourself short and sacrificing your future earning potential. So don’t lose hope. You can try to get help from the various subsidized student loans on offer.

Subsidized student loans are government initiated. Subsidized student loans can help you get through college with the least financial burden on your part. What you do is apply for one through the proper channels and comply with the requirements. Once approved for a subsidized student loan, you get your money which is required to go to tuition first, room and board second.

In subsidized student loans, you don’t need to pay the interest while you are in school. And for a while after you have left school, you still will not be required to pay the interest on your loan. The government picks up the tab for that. This is the main reason why it is called a subsidized student loan.

After you have left school and the grace period has ended, you will be required to make payments on your loan as well as the interest on it. And even at that point, you should not find it real hard to make payments because interest rates for subsidized student loans are not very high. Subsidized student loans are indeed designed for students.

But subsidized student loans require evidence of financial neediness. You can’t just approach the loan board without any proof that you require the financial aid. If you are then someone who needs all the financial help you can get to finish college but not to the point that the subsidized student loans board would consider loaning you some, then don’t despair for you still have options.

You can instead get a low income loan or one of the stated income loans available. Both of these loans require that you have a source of income. In a low income loan, you can borrow even if your income is low by common loaning standards. Of course, exorbitant rates of interest are attached to such a loan. For the stated income loans, you need not show proof that what you’re declaring as income is fact. This is good for you who are probably earning cash income from various part-time jobs. However, as with a low income loan, the interest rates are greater than what you would have had with subsidized student loans.

But you have to weigh your priorities. Getting a degree will increase your value in the job and increase your earning potential. Therefore, isn’t getting a college education, as financially breaking as it is, better in the final reckoning of things? Think about it.


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