College student loans
Students are the assets of the nation. If a plant is properly nurtured today, tomorrow it sprouts into a tree, spreading its branches all over; yielding sweet ripening fruits to all those who view it. Also it provides a cool shade to the organisms that are scorched by the heat of the sun. This gigantic tree, which was hardly visible yesterday, is known as a necessity today.
Similarly Students will tomorrow, mould the economy of the nation. They must fruitfully play their role as a citizen, parent and as a member of the society. Therefore the best form of nourishment is the quality education that accompanies them against all challenges. Education has drastically changed the standard of living and made life easier and faster. Although it is sacred, you must pay your fees to attain it because it remains with you forever. All the Students do not hail from the same family background. Some students are really fortunate because they can withdraw their cash anytime through the reserves that are created by their parents and ancestors. But we come across many pupils, whose parents undergo a painful struggle to just fill their bellies. Such Students too have an aspiration to be conferred with a graduate degree and enter the professional world.
In fact some of the students from this group may have an excellent academic record and may prove excellency in their profession compared to the well-bred students. The concept of globalization has immensely improved the standard of living and therefore the value of education has soared higher. The government also treats education as one of the most important elements to democracy. Therefore there are many sources for acquiring loan from the government because there are many financial institutions established by the government. Besides, they are many private institutions that are in existence today. The term student loan is not similar to the word scholarships. Scholarship are not to be refunded as they are the prizes awarded to students who bear a bright academic record. Student loan is the most worthwhile investment because it will fetch you a lifetime asset i. e. a secured job.
The two main categories of loans in the U. S. are a) subsidized loan b) unsubsidized federal loan. Although both of them are guaranteed by the U. S. department of education, they differ according to their interest rates. The subsidized loan is authorized by the U. S. government under Title IV of the Higher Education Act. The subsidized loans are strictly merit-based and the financial background of the candidate is taken into consideration. The amount received in the form of loan can be utilized for the total tuition fees that are demanded in colleges. While disbursing the unsubsidized loan, need factor is not considered. The rate of interest usually ranges from 4. 75% up to 8. 25%. Federal student loans are either paid to the student directly or it is disbursed to the parent.
The loan that is paid to the parent usually has higher limit compared to
the loan that is handed to the student directly. The terms and conditions of the loan provided to college students today are more flexible and also an excellent service are available to them. The rate of interest is reasonable and no out-of pocket expenditures are incurred. The Act Education Loan is designed to provide funds to students who have chosen educational programs such as secondary education, college education and even professional courses like MBA, CFA, Medicine or engineering. There are numerous advantages that can be enjoyed by the college goers.
The rates of interests are competitive and reasonable. You need not comply with many formalities, as required while purchasing a housing loan or car loan. The procedure for securing student loan is very simple. You will receive the amount immediately after 5 days if you satisfy the eligibility criteria. Even, if you have not cleared your past dues, you will not be deterred from attaining loan from this program. You can repay the amount six months after completing your graduation or leaving your high school. There are no penalties imposed for pre-payment. The amount is repayed monthly at installments. The borrower must borrow at least a sum of $1500 but he cannot borrow more than $30,000. The undergraduates or graduates can borrow amount up to $40,000 as it usually the estimated cost of attendance. The respective candidate must present his identity card to the institution in order to prove his enrollment to the particular
degree program. Students who study through correspondence are not provided with this facility. Only the students attending college regularly are encouraged. His institution must be TERI approved. Besides, his credit history must be satisfactory to reveal his ability to repay; he must own a house property and have at least two years of work experience. The income statement of the assessment year is verified to examine his capacity of repayment. He can be a self-employed individual, but he must have at least two years of experience in handling his business independently. He must be U. S. citizen and must have also lived in his country for the previous two years. The policies of this program are liberal and you can repay at your own convenience. If you are able to pay immediately after 45 days, you can pay the principal and the amount of interest at monthly installment. There are three options to repay the accrued amount.
1) Otherwise, you can start paying the amount at low installments right from your college days itself. Therefore the debt burden in the future will be reduced.
2) Or else, you may first clear off the interest charges by paying them every month for four years and then pay the principal amount.
3) There is a scheme known as the deferred principal and interest repayment. you will not face the tension of repayment during the college span. Only after completing your bachelors degree you can begin repaying the principal along with the interest accrued. The sum of interest is capitalized quarterly as you begin repaying. The rate of interest for the above-mentioned three options are variable and they vary according to the LIBOR index. But a rate of 3. 5% is fixed for the 1st and the 2nd option. The rates can never exceed 8. 97%. for the 1st and the 2nd option origination fees are paid prior to loan disbursement. The origination fees demanded are usually 3% up to 10% of the total amount of loan varying according to the repayment mode chosen and the credit-worthiness of the borrower. Ultimately, acquire the necessary knowledge to obtain loan from the most favorable source and apply for a student loan as soon as possible. Utilize the facility of loan wisely and build a rewarding and a promising career.
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