Many students will have to access student loans in order to pay for their educations. Thankfully, between the federal government and private lenders, there are many types of student loan options available to help meet financing needs. Explore all the types of student loans available to you through federal and state governments and private lenders.
When considering student loans, be sure to borrow only what you need and compare all of the different kinds of loans for college available to you before you borrow. Remember, outside of purchasing a home, borrowing to pay for higher education is likely to be one of the biggest expenses of your life.
Types of Student Loans
There are two primary types of student loans – the federal government and private lenders. You'll want to exhaust federal loans first before applying for private student loans.
Federal Student Loans
In order to obtain federal loans, you will first need to file the Free Application for Federal Student Aid (FAFSA). As of July 1, 2010 all federal student loans are provided by the US government. There are five main federal loan programs:
- Direct Student Loans Need based loans made in the name of the student that can be either subsidized or unsubsidized.
- Direct PLUS Loans for Parents Parents can borrow up to the cost of attendance with this credit-based loan.
- Direct Graduate PLUS Loan Grad students can borrow up to the cost of attendance with this credit-based loan.
- Direct Consolidation Loans Students and parents with one or more federal student loan can combine them into one, single loan.
- Federal Perkins Loan Undergrads and some grads with exceptional need may receive this fixed interest federal loan.
Private Student Loans
Private student loans are available for both undergraduate and graduate students. There are also private consolidation loans.
- Private Student Loans Credit-based loans from banks and private lenders used specifically for education-related expenses.
- Private Student Loan Consolidation Credit-based loan that allows borrowers to combine and consolidate eligible private students loans.