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Government Loans

At the present moment when there is so much of hue and cry amongst private loan agencies, each trying to downplay the merits and work of the other, the loans offered by government remain immaculate and selflessly benefiting the public.

There is no hiding the fact that Government loans are a cut above the rest in quite a few ways. As a matter of fact firstly every private agency offering loan does it with the purpose of making profits but in contrast to this government loans are meant only for the welfare of public. In addition since government is a body meant for the people, it does not seek any personal gains. Furthermore it is worthwhile remembering that unlike the private banks and other such loan agencies, government also offers loans to those downtrodden people who can hardly pay it back. In addition government loans not just a great help to the destitute but also a big contribution in the smooth functioning of the economy of the country.

It is worth mentioning in this regard that Government loans are primarily of three kinds- Business Loans, Loans for Home Buyers and Loans for Higher Education.

Since there is no denying that small businesses are quite important for the US economy, in order to promote them and enhance their development, government of America offers business loans to its citizens. Theoretically speaking all those individuals who desire to kick-start their careers by venturing into some business can materialize their dreams with the help of government business loans. Point to be noted in this regard is that what more can be added to the glory of government loans but that the present day eminent brands such as Nike, Apple Computer, and Compaq Computer etc. had commenced with the aid of government loans only.

In an ideal scenario government loans are immensely beneficial for those seeking a shelter. As a matter of fact Government gives home loans for legal purchase of any big or small house. Fact remained that the rate of interest on these home loans is deliberately less in comparison to loans taken from private organizations.

Since it is worth noting that government of America seeks to have overall development of the country, it provides financial assistance not only to elderly people but also to children or students. As a matter of fact Government enables students to have a bright future by virtue of education loans. There is no denying that these loans are a great help particularly to students who do not come from affluent families. In simple terms these loans provide a wonderful opportunity to students to go for higher education even in popular universities. It is worth mentioning in this regard that the readily available government loans for higher education not just help a student by sponsoring his studies but are a boon for his family too. This is because of the simple reason that the parents are then released from the burden of hefty fees for their childs higher studies. In other word a student can pay back the loan after completing his studies and acquiring a decent job.

On the other side of the coin the drawbacks of Government loans are that these loans are provided only to law-abiding citizens and for legal purposes. In addition also a great deal of paper work is required to procure a government loan. Always remember that the government loans are not service at your doorstep. Thats why lot of physical labor is required to get a government loan. Moreover it is worthwhile remembering that government loans are not that readily available as loans by private agencies. So more often than not it takes quite a few days in applying for a government loan and actually getting it.

Yet it is worth pointing that the shortcomings of government loans can never dominate their merits. In theory at the end of the day it is the choice of the customer to decide, which way to go.

There is no denying that as a student you can obtain a substantial financial support from

the federal government for your college tuition, books and laboratory fees. As a matter of fact the loan accrues no interest during the time that you are legitimately enrolled as a student but will commence drawing interest upon graduation or whenever you leave college. Theoretically speaking this is the information given by all school aid advisors and is pretty much on the level.

In simple terms even though the Soldier and Sailors Act of 1947 should protect you from the increase of interest after school, sometimes this doesn't happen because the actual law is misinterpreted. It is worth mentioning in this regard that many administrators feel that the steady income from a military occupation precludes any advantage in the delay of paying back a Government loans or in the reduction of the annual interest.

Believe it or not it is the repayment phase in which many problems can occur. Fact remained that after the 'no interest' phase is over, the student loan can be sold by the Federal Government to state loan agencies. More often than not they in turn can then sell them to the highest bidder and in this manner the so called student loans can be quite expensive after the interest rates grow proportionately.

The general thumb rule in this regard is that the longer the student loan remains unpaid the larger it grows in size. Always remember that almost all government loans are administered by local financial institutions and not by government agents. Fact remained that this allows many of the government loans to be placed into delinquent status when this should not happen. In addition it also permits a ratchet of the loan interest to regular consumer rates.

It is worth mentioning in this regard that under certain circumstances an education can be paid through government grants which have no interest or aren't repayable. As a matter of fact they must be applied to using published guidelines available through the government or the school grant administrator. In addition these grants have a specific deadline by which they must be solicited.

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