Lowest Interest Student Loans

Stafford Federal Direct Loan

The Stafford loan program offers federal student loans at competitive interest rates. Because they cover all school expenses including tuition, fees, books, supplies, housing and dining halls, the interest rate on these loans is very low. However, if you have private student loans that offer lower rates, use them to pay off your federal direct loan first before you repay any additional money. You cannot combine federal and private student loans together. If you default on your federal loan, the remaining balance on your private loan may become delinquent.

Perkins Federal Direct Loan

Perkins loans are intended for students who need financial assistance to attend college. It’s designed to help students complete their education without incurring heavy debt. Perkins loans are great for those going back to school after having already graduated, as well as returning students who want to enter graduate programs. Unlike the Stafford loan, which requires borrowers to start repaying their loan once they receive their degree, the Perkins loan is paid off over 10 years. Students who take out these loans should know that not only do they get higher interest rates than the standard Stafford loan, but the repayment period lasts longer.

PLUS Private Loan

PLUS loans are meant for parents who co-signed their child’s loan. Parents may be able to choose between two types of PLUS loans—one for undergraduate studies and the other for graduate degrees. Your eligibility is determined by your income, assets, and how much credit you possess. There is no maximum dollar amount of PLUS loans. However, depending on your family’s net worth, the government provides a range of allowable monthly payments. Parents who apply for PLUS loans must submit several documents, including proof of their family’s annual income.

Grad Plus Loan

Grad Plus loans are offered to students whose families earn up to $65,000 a year. Students must meet certain academic requirements to qualify. Most people receiving these loans are pursuing masters or doctoral degrees. To qualify for this type of loan, you must be enrolled full time, maintain satisfactory grade point averages throughout school, and complete 30 hours of work toward or completion of an internship each semester.

Parent Plus Loan

Parents of graduating high school seniors are eligible for Parent Plus loans. These loans are similar to PLUS loans. You must be related to the borrower and have a minimum household income of $80,000 per year. The parent must make sure they don’t owe more than $10,500.00 in total credit card debts, installment loans, auto loans, mortgages, bank home equity lines of credit, and other consumer debt. In addition, the parent’s credit score must be good enough to ensure he or she will be approved for a traditional loan. The parent must certify the student will be attending a postsecondary institution, as well as being enrolled for at least 12 credit hours per term.

Consolidation Loan

Consolidations are loans that combine federal, state, private, and federal PLUS loans together. By consolidating, you cut down on the number of applications you need to file. You can consolidate loans while still paying them off separately. For example, if you borrow $8,000 from the government, $5,000 from your parents, and $9,000 in private loans, you could save yourself some time and effort by filing just one application instead of three separate ones. In general, consolidation loans let individuals reduce their outstanding balances and keep paying down their debts faster. That said, it’s critical to note that consolidating doesn’t necessarily mean you’ll save money; it may actually cost you more in the long run.

Payday Advance

Payday advances are short-term loans that are generally issued to consumers with poor or bad credit histories. Since payday advance lenders charge steep fees, they often require collateral such as a vehicle , paycheck stub, or utility bill. These loans aren’t always based on your income history, so it’s best to avoid them and look for a reputable lender.

Lowest Interest Student Loans

Federal Direct Loan

This loan type offers lower interest rates than private student loans. You’ll need to complete FAFSA (Free Application for Federal Student Aid) to qualify. Private student loans generally have higher interest rates.

Perkins Loan

Perkins loans offer low-interest rates. You’re eligible if you meet income requirements, have completed FAFSA, and have enough credits to graduate in time. Private student loans have higher interest rates.

Grad PLUS Loan

If you’ve already received federal financial aid, you may still apply for a Grad Plus Loan. To qualify for this loan, you need to have completed FAFSA and have attended at least half of the courses you plan to take in college. You’ll pay slightly less interest than regular student loans, but you’ll have to start repaying after six years of school rather than 10. Private student loans have much higher interest rates.

Parent PLUS Loan

The Parent Plus Loan is available to parents who receive federal financial aid assistance for their children’s education. Parents borrow money based on their expected family contribution amount, which is determined by their adjusted gross income. Parents may borrow up to the full cost of attendance minus any unmet Pell Grant funding. Private student loans have high interest rates.

Lowest Interest Student Loans

I am not going to lie, I have never had much interest in student loans. I went to college right after high school and graduated with no debt. However, I noticed that my younger cousin did not go back to college until he was almost 30 years old and had over $50k in student loan debt. He said the only reason he didn’t go sooner was because he couldn’t get any scholarships. That got me thinking about how expensive higher education is nowadays. So I decided to do some research and find out what kind of student loans people actually end up paying off (or at least trying to pay off).

For this video, I wanted to share with you guys the lowest interest student loans out there today. I thought it would be best to put together a list of them since some companies don’t want to advertise their low rates. These companies I’m talking about are both private lenders and publicly traded companies.

The three biggest student loan companies we looked at were:

Sallie Mae

US Bank

Quicken Loans

Let’s start with Sallie Mae! Actually, Sallie Mae doesn’t lend money…they simply act as a middle man who buys promissory notes from students and than sell those loans to investors. If you stop making payments, they own your debt automatically, if you die they take half of your estate, and if you declare bankruptcy they get everything you own. Seriously. People should totally avoid using them whenever possible. In 2015, Sallie Mae stopped extending credit to students because the business model wasn’t working for them anymore. In 2014, the average principal owed by students grew by 0.9%, while profit margins shrank by 1%.

US Bank – US Bank makes billions of dollars a year out of charging students the highest APR around, even though they have the lowest rate. Their profits increase by turning students into debt-slave employees. Here is US Bank’s current annual percentage rate:

10.25%

Here is who holds the loan when it goes into default:

US Bank – 51%

Student – 29%

Government – 20%

It’s estimated that between 2010 and 2015, SallieMae charged 60 million Americans an astounding $154 billion in fees. There isn’t a government agency that enforces consumer lending laws so there is no real oversight. Oh, and did I mention that 10% of all college graduates are now jobless? Yup, they tried to call that statistic “misleading.”

Lowest Interest Student Loans

Credit Cards: Credit card cash back offers (free food!) & no annual fee cards (compared to 1% convenience fee)

You might have heard, but credit cards can often charge friends and family members checking account information. If not then feel free to ignore them. But generally speaking – credit cards should always be good for small purchases or if you find yourself in credit card debt. There aren’t many things we need to buy that we can’t do without one. So don’t let the negative comments make you believe that they are only meant for big spender or people who overspent all their budget on dining out and shopping.

The Federal Reserve Board has determined how much credit card companies can increase the prices of these card. Most base their increases on the rate of inflation, while some research larger fees for bigger balances. That means it’s time to review your credit card payment schedule. Make sure you are paying off at least minimum monthly payments of what’s owed within 30 days of each billing date. Also, pay your balance in full every month and avoid using it as a store card after hours of purchase.

Credit Card Tips :

Lowest Interest Student Loans

You need to get yourself out of debt before going to college.

You’re not legally allowed to borrow money to attend school since you’ll have to pay it back over time (unless you go to graduate school). If you don’t manage your spending while attending school, you’ll end up paying back loans for years after graduating! And if you do manage to pay them off early, you probably won’t be able to qualify for a larger loan amount. Don’t let student loans be one of the biggest financial burdens you face while pursuing higher education.

Take the right classes for the right career.

There’s no doubt about it: You want to study topics that relate directly to your future career goals. But choosing the wrong major could mean losing out on opportunities in your field. Make sure to choose courses that align with the type of work you will eventually be doing.

Get your finances under control ASAP.

It’s never too late to start managing your money well. While you may think that saving for retirement and buying a house is the only thing you should focus on, it’s actually pretty simple to improve your credit score, build savings, and reduce debt at any age.

Consider alternative financing options.

If you can’t afford to finance your studies based on current interest rates, explore borrowing options that might give you an edge. There are many ways to finance your education without accruing massive amounts of debt. Here are a few alternatives worth exploring: government grants and scholarships, private loans, parent loans, and even using your GI Bill benefits.

Start planning now!

Whether you’re in high school or just beginning your college experience, make sure to take advantage of the wealth of information available now! The earlier you begin thinking about what you want to accomplish in your post-graduation career, the better prepared you’ll be once you enter the workforce.

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