A Student Loans Comparison

If you’ve ever had to complete the FAFSA questionnaire or the CSS/Profile, you know what a pain it is. Endless questions about assets, this year’s taxes, last year’s taxes, taxes from two years ago… Just submitting the documents is a huge relief.
But this arduous work isn’t for nothing— it’s an interview for the loans that have made college possible for millions.
Your school’s financial aid office will offer you a package based on your eligibility, but what aid you accept is your choice. Each loan offered differs in function:

Stafford Loan

This is the most popular student loan, and it’s no surprise why— the Stafford is offered by the Federal government, which means low interest rates and tax deductibility. The drawback is that its funds are capped extremely low, not enough for full tuition.

Perkins Loan

Like the Stafford, the Perkins loan comes from the Feds. Unlike the Stafford, it sends funds directly to the student, and divvies out its funds based on demonstrated need. This makes a Perkins loan excellent for low-income students. However, not all institutions are part of the program, and funds often deplete before demand is filled.
There are also State loans that offer financing under certain conditions. Of course, these differ depending on where you live.
The other government option is the PLUS loan, which is taken out by a student’s parents. These loans can be large enough to cover the bulk of the cost of college. The parents must go through a pre-approval process beforehand, and have considerably good credit.
Not all students receive adequate financing from the government, and so the private sector steps in:

Private Loans

No FAFSA needed for these— their flexibility can close the gap in paying for school. But like consumer loans, their increased versatility comes with higher interest rates.

Consolidation Loans

These work by lumping all debt into one package. Consider only if your ability to pay is in question, because it will cost you far more interest in the end.
And before you take out a loan, make sure that you and your financial aid officer have considered all the debt-free options: scholarships, grants, and work-study.
Alexander Carl

Alexander Carl

I find it difficult to brag about myself. Too modest? Perhaps.

Anyway: my name is Alexander Carl. I am a recent graduate of the University of North Carolina at Chapel Hill, where I spent four blissful years earning a degree in Communication Studies. Now I face the real world of economic downturns, student loans, and the absence of “academic” camaraderie.

Yet I refuse to be bummed. My economic philosophy is to live simply, save, and maximize whatever I can. Consumer culture is undeniably pervasive, but you don’t have to sell your soul to co-exist with it— there is great power from using your economic resources wisely.

I started writing when I figured out how to hold a pencil. Since then I’ve written short stories, poetry, screenplays, and have blogged. In fact, three of my screenplays have been produced into short films, two of which I directed. I’m no stranger to the media, having served as a DJ at a freeform radio station and worked as a crew member for live TV.

Pastimes include traveling (I’ll visit virtually anywhere), swimming, jogging, hiking, and hunkering down with a good movie.

Overall I’m a peaceful person, though not in a creepy New Agey way. I get my energy from music, good conversation, and the outdoors (I was an active Boy Scout, earning my Eagle). I consider myself “inquisitive” and “wry”, and for the sake of autobiography I’ll assume that I am.
Alexander Carl

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