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