The higher education is so expensive that almost every one is in need of loan. There are various kinds of loans which are available in US. There are some schemes by which you can get the loan now and pay back after you have completed your graduation. However there are some differences between different types of schemes and you should know that in detail.
Some of the schemes are:
1. Federal student loan for students
2. Federal student loans paid in name of parents.
3. Private student loans.
You can categorize different kind of loans into some sub category as well. For example there are two types of federal student loans. The first one is subsidized loans and the second type is unsubsidized loans.
You will come across federal direct loan as well. However I am describing the above three kinds of loans:
1.Federal student loans for students
Actually the US government knows that all the students need loans for their graduation. Hence they have provided the loans to the students. This is different from scholarship and it is required to pay back the loan amounts. However there are some types of loans which carry interest with them from the beginning. However there are also some loan schemes that don't carry any interest burden unless and until you have completed your graduation. Federal student loans come in this kind of category. US government offers the loans top the students because they know their problem. I would also like to add one more point and that is; you can get two types of loans as far as federal student loans are concerned and that is subsidized and unsubsidized loans. The subsidized loan does not charge any interest unless and until you complete your graduation. Actually the interest is paid by the government. I will explain it for you. Suppose you take loan of $10000 and its interest during your graduation mounts to $2500. Then this interest will be paid by the government and you will have to just pay $10000 after graduation. However as far as unsubsidized loans are concerned you will have to manage the interest from start. However both the schemes provide a grace period of at least six month.
2.Loans for parents:
Education loans are also provided to parents, however the interest rate is very high and also they are required to pay the interest from the beginning. You will quickly realize that you will be in loss.
The third kind of loan is also similar but you will be required to pay a very large amount as an interest. I will really recommend you that students should go for loans on behalf of their own name.