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This page focuses on loans. For a broader discussion of
financial aid, go to our Financial Aid
page. Sites listed below are in random order and no ranking
is intended.
How are "financial aid" loans any different from
other loans?
First of all, loans for education would generally not be available
from a commercial lender, who is likely to view a loan to a person
or family of financial need for education as too risky. Banks often want collateral, a tangible asset to back
up the loan in the event of default by the borrower. Some
families may use their home, or other real property, as collateral
by to obtain money via a second mortgage or home equity loan.
But many families will not have that option; for them, the various
federal, and, to a lesser degree, state, financial aid loan
programs provide the funding needed for higher education.
Indeed, to the extent borrowed money is needed for education,
families and students should take the fullest advantage of these
government-backed loans. They have lower interest rates than any commercial
lender would be willing to accept for such loans, and they may be
"subsidized", meaning that the government will pay the
interest on them while you are in school, during
"deferment", and during "grace periods."
For certain unsubsidized loans, you may defer making interest
payments until you graduate or leave school, in which case the
interest is added to the loan amount, increasing the total amount
that you must repay. For more detail, visit any of the sites
listed on this page.
Where can I get such a loan?
You may be able to get it from your regular bank. Many
banks do participate in these financial aid loans; they do so
because the loans are backed by the government. They will
require verification from your school before making the loan.
If you need to search for a lender, visit SallieMae (click on
link below) and use their search service. Or, apply online
at any of four sites mentioned on this page (CollegeBoard,
Educaid Online, SallieMae, or Student Loan Funding).
 As
indicated on our Financial Aid page, The FAFSA is used to
determine your eligibility for Federal
Student Aid Programs, including the following loans:
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Federal Stafford Loans:
1. Federal Family Education (FFEL) Loans (Subsidized
and Unsubsidized)
2. Federal Direct Stafford Loans (Subsidized
and Unsubsidized)
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Federal PLUS (Parent Loan for Undergraduate Student) Loans
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Campus-Based Programs are administered by
participating schools. There are three of these programs,
including Federal Perkins Loans
Note: A subsidized loan is one that the government
pays the interest on while you are in school, during grace
periods, and during any deferment periods.
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The Sallie Mae Web site (www.salliemae.com) is one of the most comprehensive sources of information on financing higher education available on the Internet. Online account access, the free Online Scholarship Service, low-cost lender search, calculators, and Financial Aid 101SM are among the many valuable features found on the site.
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Collegeboard.com,
the company that administers the SAT and Advanced Placement
Program, also has some very good information on loan programs for
students and their families.
College
Answer's page for Loans
to Help Pay has substantial information on federal loans and
private loans.
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