| A student loan is a loan that is granted to a college | | | | saves a tremendous amount of interest in the long |
| student enrolled in courses full or part time for at | | | | run, since a student loan repayment plan can extend |
| least one semester or quarter and who have | | | | over 25 years depending on the loan balance. Those |
| declared a major with the intent of pursuing a degree | | | | students with an extremely low student loan balance |
| of higher education. Student loans can be granted | | | | ($5,000 or less) usually only have the typical 5 or 10 |
| through various lenders with a governmental | | | | year repayment option. A student loan is eligible to |
| guarantee, or can be granted from private lenders | | | | be used for tuition, books, on campus housing and |
| with no guarantee. Some student loans do not | | | | childcare expenses. Some student loans allow for the |
| require a parent's signature, while others do. The | | | | purchase of an automobile to get to and from |
| government guaranteed student loan is classified by | | | | school, or other pertinent school materials such as a |
| two types, subsidized and unsubsidized. | | | | computer or to pay off other student loan debt. |
| The subsidized student loans have a yearly limit and | | | | Many students today are counting on student loans |
| allow for the government to pay the interest on the | | | | for their education. What they are not realizing when |
| loan while the student is in school. The unsubsidized | | | | they sign the student loan promissory note is the |
| student loan allows for a higher yearly limit, but the | | | | debt they are incurring for a very long time after |
| student must pay the interest while in school, or the | | | | their schooling has been completed. The average |
| accrued interest will be added onto the balance of | | | | student loan balance is upwards of $50,000 for a |
| the loan and is the responsibility of the student during | | | | four year degree. Add to that professional education |
| repayment. A student loan can be deferred while the | | | | costs, and some students will have over $150,000 in |
| student is in school half time indefinitely. Private | | | | student loan debt. While the investment of an |
| student loans usually have a set period of deferment, | | | | education is always a wise idea because investing in |
| 2-5 years, and then the student must begin | | | | one's mind will never diminish in value, the costs |
| repayment regardless of whether or not they have | | | | associated with this investment and the income |
| completed their education. | | | | expected to earn should be carefully evaluated. Some |
| Currently, student loans have the best interest rates | | | | careers do not warrant a high enough salary to repay |
| in town. As the interest rate index rises, so will the | | | | the loans. Grants and scholarships should always be |
| student loan rate. During low rate times, many | | | | considered as alternatives to obtaining student loan |
| scramble to consolidate their student loans. This | | | | debt. |