Sometimes dream to pursue higher education are accompanied by huge expenses as the fees structure of the best local and foreign universities is quite expensive. As far as the credit history or credit score of students is concerned, either they have no or bad credit history. Due to this reason, they are in fix either they will get the education loan or not. But in order to avail education all you need to do is simply apply as there are a lot of options available including Federal loans, private education loans with either higher rate of interest or involvement of a co-signer with a stronger credit history than yours. Explore all the options and choose wisely.
Loan Options Available
For students with no or bad credit large number of private and federal loan options are available with terms mostly suitable for students. These options need to be examined very properly as there are certain limitations of loan schemes that are offered to the students with low credit history. Either you don’t get the full amount as you have requested or the interest rate is unfavorable. Scrutinize all the available options and pursue higher studies with loan aid.
Federal Student Loans
Often students with bad credit apply for federal student loans as there is no credit check for these loan schemes. If you apply outside the interest rates will be quite high whereas in the case of federal student loans the interest rates are very low and the subsidy options are also available with the students. This means that the government pays for the interest on a loan that the student has availed for the period the student is still studying in school. This is the most basic of the student loan option available.
Though there are a lot of options available including subsidized or non-subsidized loans, the loan amount approved is less than that of the total education expenses. This is the only drawback with federal student loans. The term period for the federal loan is generally 10 to 25 years. There are certain terms in federal student loans also which include having the citizenship of the state or full-fill the terms of non-citizen eligibility, then you need to fill the FAFSA form which a free application for federal student aid through the government website.
The loan amount approved is influenced by the fact that either you are getting financial aid from your parents or not. The repayment process is very well structured. All the possibilities or troubles are well considered that include deferment, unemployment or any other emergency due to which you are unable to pay the loan or interest amount and required aid is given accordingly. There is a provision of grace period of up to 6 months available for students also.
Private Student Loans
If the loan amount offered by the federal student loan is not enough to meet the education needs of the students, they can always opt for private loan options available from a large number of banks and other financial institutions. But while you opt for private loans the interest rate is higher as compared to federal loans and a co-signer with a strong credit is generally required if your own credit is poor. There is a certain type of private loans available that require you to full-fill certain terms before the loan amount is transferred to you.
Since it is a student loan the terms to return the loan are kept quite flexible and provisions are made that the student does not feel the burden of the loan while he is pursuing education or is unemployed for a certain period after the completion of education. The major various types of loan available in the United States are based on the terms whether you are a student of the U.S or a foreign national studying there. The two most favorable loan options available are discussed in depth for students to have complete knowledge about them.
Ascent Independent Student Loan
If you are a citizen of U.S. or you are a permanent resident then you may apply for this student loan irrespective of the fact whether you are a junior, senior or a graduate student. The student need not show any credit history or a co-signer to obtain the loan. The amount ranging from 2000 to 200000 dollars can be availed in the form of a loan with a term of 10 to 15 years. The repayment of the loan starts after 6 months from the date the student leaves the school.
The students are bound to full-fill certain requirements including- no reported bankruptcy over last 5 years, not defaulter against any government or student loan, no unsatisfied judgments, no charge-offs etc., in order to meet with the credit requirements.
M Power Student Loan
If you are an international student and do not own the citizenship of the country than a loan option available for you in order to complete your education is M Power student loan. The students having a deferred action for childhood action status are also covered under this scheme. The loan amount sanctioned ranges from 2000 to 50000 US dollars with a loan term of 10 years. During study period only interest amount is to be paid by the students and after that full payment of the loan installments in 10 years.
The Bottom Line
Higher education is very important for an individual in order to compete in the competitive world and student loans available from various federal government and private companies help you pay the fees for not so affordable education. Closely examine all the schemes available and opt for the best-suited scheme so that you may complete your higher education and can give a boost to your career and your assets. Education is the best investment one can make and the returns in this investment are most profitable than any business deal or investment.