Important Information about FAFSA Student Loans
Acquiring education in today’s world has become pretty difficult despite having innumerable institutes because of the sky-high tuition fees and other educational expenses like the costs of books, hostel charges etc. This has left the students with no choice then to apply for some sort of financial assistance. Now filling out a FAFSA (Free Application for Federal; Student Aid) form is the best way to avail the federal scholarships, grants and loans. Aspirants are normally required to fill out the FAFSA forms in February every year to apply for the federal assistance.
Now as the FAFSA student loans unlike grants and scholarships need to be repaid after you graduate so it is vital to get a little information about these loans. FAFSA student loans are basically of two types and are pretty popular with the students for a number of reasons. These are Direct Stafford loans and the Perkins loans.
These loans are known for their low interest rates as compared to the private loans. Plus the interest rate in these loans remains fixed over the life of the loans which can be very helpful for the students. Now there is a further sub-classification among the Stafford loans that is, subsidized and the unsubsidized Stafford loans.
- The subsidized Stafford loans do not accumulate interest while you are in school/college and the government pays it on your behalf.
- While the unsubsidized loans start building up interest even while you are in school, now it’ up to you if you want to clear it up side by side or let it accumulate and clear it up after you graduate. It is however, always suggested that you pay the interest of unsubsidized loans side by side rather than letting it accumulate. Despite all this, even the unsubsidized Stafford loan is far better than the private loan.
These loans are also widely applied via FAFSA by the students. Perkins loans are normally provided to students depending upon their financial need by the college or school they are enrolled in. These are also government sponsored loans and the interest does not accrue while the student is in the college.
The best thing about FAFSA student loans is that the students do not need to worry about making payments right after leaving the college since in case of Stafford loans, the students get a grace period of 6 months during which they don’t need to start making repayments and in case of Perkins loans, this period is further extended to 9 months. Last but not least, though these loans are a way better option than any other type of loans yet you need to repay them so better borrow the amount carefully.