All About Private Student Loans
Let us think of education as the means of developing our greatest abilities, because in each of us there is a private hope and dream which, fulfilled, can be translated into benefit for everyone and greater strength for our nation. John F. Kennedy.
Acquiring a good education is among the most important things we can do to increase our success in this world. Its the key that unlocks doors to new opportunities. It will allow us to help others and to make a difference in the world. Yet, getting a good education costs a great deal. Tuition by itself costs anywhere from $3,000 to $100,000 per year! Consequently, many students simply dont have the money to pay for college and, therefore, must explore other options. Taking out a private student loan is an option that students may want to consider.
First of all, what is a Private Student Loan?
Private student loans, also known as alternative student loans, are loans that are taken out from anywhere other than the federal government. Private student loans can be issued from banks, credit unions, or other financial institutions. These loans usually receive their funding from private financial organizations and are, therefore, not subject to Federal demands.
Alternative student loans are for students who decide against Federal student loans (such as the Stafford or Perkins loan) or who desire to supplement their Federal loan because it alone will not cover all the expenses of higher education.
The size of the private student loan is determined by whether or not the student has good credit.
How can I get a private student loan?
Each financial institution will have a different list of eligibility requirements however here are a few of the requirements that you will likely run into:
- You must be a U.S. citizen
- You must be at least 18 years old
- You must be enrolled at an approved school
- You must have a good credit history OR apply with a creditworthy cosigner
Not all of the financial institutions will require these things and some of them will require more, but these are the basics.
Before taking out a loan:
SEARCH: The best way to find the loan you need is through exploring your options. Be cautious of businesses that are only trying to scam you. If an offer appears too good to be true than it probably is. Take a good look at your options to make sure that you get the best deal out there and that you avoid the scams.
SCRUTINIZE: When youve located the right loan, pull up a chair and examine the contract. Never put your signature on something that you have not read or havent read thoroughly. Make sure you fully understand what type of agreement you are making with this company. If you do not fully comprehend something, dont be afraid to ask. Feeling slightly stupid up front is much better than feeling terribly stupid when you have to pay out an enormous amount of money simply because you did not take the time to fully understand the agreement.
SIMPLIFY: Simplify your college life by deciding now that you will consistantly pay your bills on schedule. Refusing or forgetting to do so will enlarge the size of your loan and your debt and add extra stress into your life. Deciding to pay your bills on time every month will help you stay out of the dark chasm of debt and discouragement.
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About the Author
A college student herself, Elise Fisher enjoys writing articles that help students understand how to pay for tuition, books, housing, and all the other expenses that come with gaining a higher education. She has also built a website that helps students understand everything they need to know About Student Loans. Make sure you visit the Student Loan Alternatives page.
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