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Stafford Loans
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For most of the students getting financial aid is always a problem. The federal government gives out these loans. These loans are given to students who have got admission in any certified educational institution. The student starts repaying the loan after the graduation is completed. These loans are either subsidized or un-subsidized. The interest rate is charged only when the repayment period starts when you take a subsidized loan. But in case of an un-subsidized loan you will have to pay the interest as soon as the loan is given out.
The Stafford Loans are of two types:
• Subsidized Stafford Loans: these are given out based on the financial needs of the student. The student is required to prove the capabilities to the government and the financial help that he/she wants. In this type of Stafford loan the government is liable to make payments towards the interest of your loan for a minimum duration of half time of the course.
• Unsubsidized Stafford Loans: with these loans the student is required to pay the interest rate while still in the college.
When you take a Stafford loan you are benefited in the following ways:
• With Stafford Loans there is no credit check carried out if the student qualifies. Besides if the student is a U.S citizen has been academically strong then the loan is approved easily.
• The interest rates on these loans are lower as compared to the other loans. Moreover the amount can be used for meeting any expenses related to the education.
• The payback terms for the loan are flexible and can be extended to a period of 30 years if the student opts for debt consolidation.
• You get the benefit of deferring on the loan once a year up to a time limit of three years.
• The interest rates paid on these loans are tax deductible.
When you wish to get a Stafford student loan then you are required to fill out an application
form for the Federal Student Aid, which is free of cost. The procedure of filling the form can be both in person as well as can be accomplished electronically. To get a federal student loan you are supposed to be a citizen of the United States or you should be an eligible non-citizen who has a high school certificate or a diploma or besides this if you even have a General Education Development certificate and you are in dire need of money to carry on your studies. Besides this you should also be preparing to get admission into an educational institute.
Apart from the necessary qualifications required if you are caught on charges of possessing or having drugs then you could be denied of the federal direct student loan. But still there are some chances that you can get the loan so you should fill out the form and keep on checking on the status of your loan time after time. When you apply for a Federal student loan it is advised that you take the loan directly from the government and do not approach any private lenders or agencies as there are chances that you might end up in a scam. Every year there are many agencies that make millions of dollars by doing this.
The Stafford Student Loans are given on the basis of the need of the student that is assessed by the government. In case the student is taking an unsubsidized Stafford loan then the need is not evaluated. Besides your needs being evaluated the Department would also like to know about the family income and the Expected Family Contribution. This would help the government determine the amount of loan that you would require. You would have to provide these details with the form that you submit with the Federal Student Aid department.
If after some time you feel that the interest rate for your Stafford student loan is high then the government also provides you the opportunity to consolidate your student loan as well. With a federal direct student loan consolidation you can get the loan at a lower interest rate. In case you have a problem in meeting the expenses and you are close to defaulting on your loan then you can consider a federal student loan debt consolidation. If you consolidate your federal student loan when you are still in school then you can get a grace period of six months before you start payment towards the federal student loan consolidation.
Students who apply for Federal debt consolidation loan can get the privilege of either repaying less amount of the debt each month or increase the time duration of repayment. By taking Federal debt consolidation loan students can combine the various loans that they would have taken under different schemes and combine all of them into one. By doing this, the student is liable to make only one payment that has to be made to the government of the United States. These loans have been made more feasible and the payments have been divided into four payment plans, which are quite flexible. Out of these four payment plans two would take into consideration your income or the expected income.
Make sure that when you apply for the Stafford student loans then you have all the documents ready. Most of the times the students prefer to go through the process of applying for the loan through a private mortgage broker and end up getting into trouble so it is better that you get these loans directly from the government and not from any private agency. Besides there are very few offers available so it is better that you decide on your loan fast and apply with all the necessary documents that are required.
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