Best Student Loans For Undergraduates

Direct Subsidized Loan – Federal Direct Unsubsidized Stafford Loan $6,500-12,500 max per year or Direct Subsidized PLUS Loan (Parent/Child) $8,500-18,500 max per year

Parental Guaranteed Loan – Federal Perkins Loan $2,000-13,250 max per year

Private Nonprofit Scholarship – Scholarships awarded based on academic merit

Federal Work Study Program – Up to 20 hours per week paid at minimum wage

State Grants for Higher Education – Based on need

Private Scholarships and Financial Aid – Offered by universities

Best Student Loans For Undergraduates

Federal Direct Loan Program

This loan program is offered by the government at no cost to students. You can receive a loan between $50,000-$100,000 in order to pay for college costs. Your monthly payments range between $0.00-$5.00 depending on how much money you borrow. You need to meet certain requirements to qualify for this loan including having a minimum grade point average of 2.5 and maintaining satisfactory academic progress while attending school.

Stafford Loan

The federal student loans provided by the US Department of Education provide you with funds for tuition, fees, books, supplies, equipment, and housing. The maximum amount you obtain is determined by the cost of attendance at your university. The interest rate on these loans varies by borrower based upon their credit history, however, you may have to repay the entire principal balance over a period of 10 years. If you do not make minimum payments, you will accrue additional interest charges that will increase your total payment amount.

Perkins Loan

Perkins loans are considered low-interest loans given to students who maintain good grades and demonstrate financial need. These loans are only available at public colleges and universities and are distributed by the U.S. Department of Education. The amount you receive ranges from $500-$10,000 per year and comes with a 0% fixed interest rate for the first six months with a variable interest rate between 5%-8% after that.

Parental PLUS Loan

If you want to pay for private schools or if you attend for-profit institutions, then you might want to apply for a loan from your parents. Parents Plus loans carry a 6.84% interest rate and require 30 years to fully repay. However, they do allow you to take out extra money without paying any interest until the loan is paid off.

Private Loan Programs

Private loan programs are not widely used by undergrads, but they offer flexibility. Private lenders will give you money for any type of education, but you’ll pay a higher interest rate than the federal government. The interest rates vary greatly depending on the lender and the terms of your agreement. If you don’t have a job or income, you could find yourself stuck making high monthly payments.

Scholarships

Scholarships are awarded to students who excel academically and represent a financial hardship. There are many scholarships available and application deadlines change each year. Scholarship applications are usually completed early in the fall semester and should be submitted before submitting your FAFSA.

Work Study

Work study opportunities are available at both individual companies and larger organizations. Most employers require that you have a job lined up for graduation day in order to participate in the work study program. Work study jobs are generally less lucrative than traditional employment options, but you retain some independence and freedom.

Best Student Loans For Undergraduates

Federal Direct Loan Programs

The federal direct loan programs (FDL) are a popular type of student loans. These loans allow students who qualify to borrow money at low interest rates. You may be able to get a subsidized loan if you meet certain requirements. Your lender will likely charge monthly payments based on the interest rate on these loans plus fees.

Stafford Loan Program

This program offers subsidized loans to undergraduate students only. Students who go to school full-time, have no bad credit history, and make satisfactory academic progress pay less than 10% of their discretionary income toward their education. If you receive this kind of loan, your lender will deduct your interest before paying your tuition costs directly to the institution.

PLUS Loan Program

This program allows parents and children to get subsidized loans together. Parents must be working when they apply, and their income cannot exceed 150% of the poverty guidelines. Children must be enrolled at least half time and maintain good grades.

Parental Consolidation Loan

A parental consolidation loan is a fixed interest rate loan taken out by both the borrower’s parent and child. A parent can consolidate his/her previous loans into a single loan while still maintaining separate accounts.

Best Student Loans For Undergraduates

Subsidized loans give eligible students a fixed interest rate while they are enrolled at least half time. 2. Perkins Loans assist undergraduates who need larger amounts of financial aid while attending school. These loans offer eligible students a low interest rate which remains fixed throughout their loan term. 3. Parent Plus Loans provide parents with guaranteed funds to pay for their undergraduate educational expenses.

Best Student Loans For Undergraduates

Federal Direct Loan Program

The federal direct loan program is the best student loan option, because it gives students two options: subsidized and unsubsidized. You can apply for up to $31,000 in loans. If you don’t qualify for any type of grant, then you should definitely opt for the federal direct loan.

Stafford Loan Program

Stafford loans offer low interest rates and flexible repayment plans if you choose. However, they are only available to those who have a high school diploma. A full-time minimum wage job is necessary to repay these types of loans. Students with good grades are eligible for the maximum amount of $20,500 per year.

Perkins Loan Program

For students seeking graduate degrees or professional degrees, Perkins loans give out higher amounts than Stafford loans. However, Perkins loan holders do not need the same level of discipline as Stafford loan holders. This means that borrowers may find themselves in default often. Graduate students attending school full time are allowed to borrow up to $37,500 each academic year.

Parent Plus Loans

A parent plus loan combines parent PLUS (Parent Loan) and private student loans and comes with many perks. Interest rates range from 2% to 6%. Borrowers must make payments on their parent plus loan monthly at least 10 days before the due date for their other loans.

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