Student Loan Interest Rates | Federally Funded Student Loan Interest Rates
Student Loan Interest Rates : Getting It As Low As Possible Student loan interest rates will vary based on the type of loan that is applied for. Knowing all your options is the key to choosing the right financial aid plan suitable for each individual. Student loans generally have lower interest rates attached to them than conventional loans. Another factor to keep in mind is that most student loans also have the added benefit of not needing to be repaid for the duration of studies, and this applies to interest rates as well, in that the interest rates will only begin to accrue once the repayments are to begin.
This is good because it alleviates the financial pressure on students or parents.As a general rule, subsidized loans will carry lower interest rates than unsubsidized loans. For example, if you apply for a purely private student loan, the interest rates will be much higher than a loan subsidized either by the school or the government. Federally Funded Student Loan Interest Rates Also take into consideration that federally funded loans are also subject to this, for example, an unsubsidized Stafford loan will have a 6.80% APR, whereas a subsidized Stafford loan will only have a 4.50% APR.Another point of consideration is the differences in interest rates for student loans to parents and to students.
Federally funded student loan interest rates will be lower for loans that are made directly to students, while federal loans to parents will have a much higher interest rate.Lastly, when considering student loan interest rates, you should keep in mind that in a lot of cases interest rates do not begin to accrue until the time of repayment. This is very important because a general college course will take anywhere between 2-4 years, which is a long time to have interest accumulating. Always check to see when the interest rates will begin to apply for the loan you wish to take out so you can plan properly on your repayment plan.