Covering the cost of higher education can be a challenge for any new student. The good news is that nearly everyone is eligible to receive some form of financial aid. Be sure that you complete your FAFSA (Free Application Federal Student Aid) for the upcoming 2008-2009 school year to begin the award process. With college costs rising, some students have no choice but to borrow for their education expenses, but there are steps you can take to ensure that you borrow smartly. Students and their families should only borrow what they need to cover the cost of tuition and other expenses incurred by attending college.
Whether you are a first time borrower or a returning student borrower, please take some time to review our list of loan options at applyforaloan.sacredheart.edu. Our list of suggested lenders and loan programs serve as a guide to you in navigating the loan process.
To start, make sure you take full advantage of the federal student loan program before you take out any private loans. Federal Stafford loans are guaranteed by the government and as of July 1, 2008, the interest rate for Stafford loans will be 6% and the cap for this loan is 8.25%. Federal loan borrowers also have deferment options available to them once their loans enter repayment.
Private student loans, which are not guaranteed by the federal government, have variable rates that are typically tied to the prime rate or another benchmark. Rates range from 6% to more than 14%. Students can apply for these loans on their own but have a better chance of approval as well as a better interest rate if they have a credit worthy co-borrower.
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