Unfortunately, with the rising cost of college and graduate school, many students must take out some private loans because they've maxed out on the available federal student loans. Also, unlike federal student loans, private student loans are subject to a statute of limitations when you default. The statute of limitations varies by state, generally ranging from three to 10 years. If the statute of limitations expires, lenders have few options to collect from you.
Also, paying your private student loans isn't always straightforward. Borrowers with private student loans have cited numerous problems related to making loan payments, like dealing with loan servicers that:. To learn more about federal student loans—and student loans in general—visit the U. If you need more information or advice after visiting these websites and doing your own research on student loans, consider consulting with a student loan attorney or debt settlement attorney who deals with student loans.
The information provided on this site is not legal advice, does not constitute a lawyer referral service, and no attorney-client or confidential relationship is or will be formed by use of the site. The attorney listings on this site are paid attorney advertising. In some states, the information on this website may be considered a lawyer referral service.
Please reference the Terms of Use and the Supplemental Terms for specific information related to your state. Grow Your Legal Practice. Meet the Editors. If you have a student loan that the federal government provided or guarantees, your loan likely falls into one of two categories: direct loans or indirect loans. Private student loans, however, are different. How Federal Student Loans Work For many students, available scholarships, grants, and work options won't cover all of their college costs.
What Is a Federal Direct Loan? Direct Subsidized Loans Undergraduate students who can show they need financial help can get this kind of loan. The government pays the interest on a Direct Subsidized Loan during the following periods: while you're in school at least half-time during the grace period in most cases , and during a period of deferment when loan payments are postponed.
Direct Unsubsidized Loans With an unsubsidized loan, you—not the government—pay the interest during all periods. Direct PLUS Loans Direct PLUS Loans are available to: graduate or professional students who are enrolled at least half-time at a school with a program leading towards their graduate or professional degree or certificate and to parents of a dependent undergraduate student enrolled at least half-time at an eligible school.
Direct Consolidation Loans With a Direct Consolidation Loan , you can combine consolidate your federal education loans into one loan. Federal Perkins Loans Perkins Loans were previously available to undergraduate, graduate, and professional students who had exceptional financial need. Federal Student Loans: Pros and Cons Federal student loans have many advantages when compared to private student loans and just a few disadvantages. Advantages Federal student loans are almost always a better choice than private student loans.
Here's why: Federal student loans have generous and flexible repayment options that can lower your monthly payment.
Federal student loans have various cancellation options. As of , all federal student loans have fixed interest rates. Federal student loans are eligible for deferment and forbearance.
William D. Ford Direct loans are made directly from the Department of Education to students, without the involvement of a private lender.
These loans were made by private lenders and guaranteed by the government. However there are some differences in repayment options. Please visit our blog for the most up to date information on what this will mean for student loan borrowers. Federal Loan Basics Can I get relief?
Prior to June 30, , lenders issued federal student loans either as guaranteed student loans or as "direct" student loans. Direct loans are issued directly by the federal government. Whether you received guaranteed or direct loans depended on which loan program your school signed up for. After June 30, , you can only get a federal student loan under the direct student loan program. A direct loan is made directly from the federal government to students. The federal government contracts with loan servicers to handle day-to-day loan management.
The most important difference between guaranteed and direct loans is the availability of repayment programs. The federal government offers several repayment plans for low-income borrowers like the:. Some of these plans are available to certain FFEL borrowers. Generally, the repayment plan options are more generous for direct loans than for FFELs.
The information provided on this site is not legal advice, does not constitute a lawyer referral service, and no attorney-client or confidential relationship is or will be formed by use of the site. The attorney listings on this site are paid attorney advertising. In some states, the information on this website may be considered a lawyer referral service.
Please reference the Terms of Use and the Supplemental Terms for specific information related to your state. Grow Your Legal Practice. Meet the Editors. The federally guaranteed student loan program ended June 30, But many people are still paying on guaranteed loans issued before then.
0コメント