Federal Student Loan
Student who completed FAFSA is eligible for financial aid from federal student loan. They may offer subsidized, unsubsidized or combination of both to a student. The eligibility of student is determined by the FAFSA result, total cost of attendance and other financial aid resources.
The interest rate for year of 2010 - 2011 is as below :-
1) Undergraduate - Subsidized Loan - 4.5% (Pay by Federal Government), Unsubsidized Loan - 6.8% (Pay by Student)
2) For Graduate - 6.8% (Pay by Federal Government), Unsubsidized Loan - 6.8% (Pay by Student)
As other student loans, federal loan also will impose a fee charge to student. 1.5% of loan origination fee for process of your loan. However borrower will receive a loan rebate 1% from lender, therefore the total upfront fee is just 0.5%. But borrower must pay the 1st 12 payments on time to get this benefit,otherwise it will be waive.
Every loan for a student also applicable for 6 months grace period after completion of study, means that you can start your payment after 6 months. If a student further their study after grace period, the loan will qualify for deferment while enrollment. Once the course completed student has to repay immediate.
Before borrow money from federal government, you should clearly know that the overall costs for entire course. Basically, they will lending the exact figure for the whole course. But do not forget that some other living costs, transport, course materials and etc. Seek for grants and scholarships to assist or support you.
For more Federal Loan information, please check out Direct Student Loans instead of Federal Student Loan
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