beRecruited Advice: Financial Student Loans for College

Student Loan Information

If funding college is an issue, talk to your guidance counselor and your family about possible options. Maybe you’ll have to cut a couple schools off the list. Perhaps you can apply for various scholarships (especially if an athletic scholarship looks doubtful). Most schools offer financial aid and/or academic scholarships- so make sure to inquire about these.

If you receive a loan, you must sign a promissory note. This document acknowledges your acceptance of the loan’s terms and conditions. Typically, student loans are managed by banks and financial institutions, which handle payment options and determine how much interest you will pay. The bank will provide you with a payment schedule, as well as the approximate date that the loan will be paid in full.

Three basic types of student loans are available: 1) the Stafford Loan, 2) the Perkins Loan and 3) the PLUS Loan.

The Stafford Loan

The Stafford Loan requires no collateral, has a low interest rate, and must be repaid beginning six months after graduation for students attending school at least “half time.” (Half time means you have to be taking at least six credit hours a semester.)

The minimum you may borrow fluctuates annually and escalates from your freshman to your senior year. In many cases, the Stafford Loan can be subsidized based on financial need, meaning that interest will not start accumulating until six months after you graduate.

Stafford Loans are designed for students who cannot cover all of their expenses during college and will likely gain employment upon graduation.

The Perkins Loan

The Perkins Loan is based entirely on financial need. There are maximum amounts a student can borrow for undergraduate and for graduate school. These loans have low interest rates and do not require repayment until nine months after you graduate.

The Plus Loan

The PLUS Loan (Parent Loan for Undergraduate Students) is offered to parents of dependent students who require financial assistance. The interest rate is low and repayment begins 60 days after the final loan payment.