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Why You Should Qualify For Subsidized Student Loans

Are you struggling to pay off your high educational costs? You can look for some federal government student aid program to help you in the place. These loans usually accrue the interest rates till you pay back the loan amount. 2 most common type of federal loans which assist the US students are Federal Stafford loan and Perkins loan. Out of these 2 Stafford loan is easier to obtain. These loans neither require you produce a co signer nor your credit history. All it considers to provide the loan is “your financial true need to obtain the loan”.  The loan amount you can be allocated depends on the factor whether you are dependent on your parent or independent one. If you are an independent one then you can make yourself avail for some larger amount. Government will pay of the interest rate as long as you are in school.

Perkins loan amounts are allocated to the schools and universities. So when you apply for the loan it is your school or the university which determines your eligibility for the loan program. It will infer the data you have entered in your FAFSA application form. You should prove your financial need against of all other students to obtain this loan. Perkin loans are offered with low interest rates.

When you apply for the loan you may or may not get qualify for the subsidized student loans. Perkin loans and subsidized Stafford loans are beneficial. Interest rate will be added up to your principle amount but the federal government will take care of this interest when you are in school. But in the UN subsidized loans students need to make their monthly repayment or they can let the interest rate to be added with their principle amount and can pay off later.

Both Stafford and Perkins loans can be subsidized but you need to demonstrate your financial need against of all students who have applied for the same loan. When you get qualify you will not accrue any interest rate with your loan until your graduation.

When you apply for subsidized student loans it is given with the faith of you will find a job when you come out of your school. Through this job you can make a loan repayment. Grace period ( the period that exists between when you come out of school and before start of repayment term) for Stafford loan is 6 months and the grace period of the Perkins loan is 8 month. When you do not find a job in this period you need to utilize the time to apply for the deferral.

Student loan deferment

To get approval for the Deferrals you need to prove that you cannot find a job after finishing your graduation but you also need to demonstrate that you are trying though. If you have started to repay then you lose the job accidentally still you need to demonstrate this economic hardship. Student loan deferment period is 3 years. If your loan is subsidized one then you don’t need to pay off the interest in this period else interest rate will accrue but you can again pay off the interest alone in this period or you can let that to be capitalized.

Forbearance

Suppose your application for the deferment get fails to qualify you can apply for the forbearance.  In this either you can just stop paying back the student loans or you cut down on your interest rate and lower the repayments. However regardless of your loan is subsidized student loan or non subsidized student loan you need to pay the interest rate.

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