College School Loan

If you need help paying for school because federal funding and other sources of financial aid didn’t cover all of your educational expenses, then you’ve come to the right place. We have put together amazing resources for you to compare offers at competitive interest rate, repayment term options, and no required payments while in school details all in one location.

Be Mindful of College or School Loan Interest Rates

One of the most popular questions we get asked a lot is: how much are the interest rate on school loans?  Shopping for a private school or college loan can seem like an intimidating process. Chances are you want to find the most competitive school loan out there with the cheapest interest rates but you feel overwhelmed by the financial lingo and language that accompanies these school loans. This is normal and you can rest assured that College School Loan is here to help you!  We’ll clarify some of the major differences in school loans and provide you with the information you need to evaluate your options and make informed decisions.

How to Shop for Private College Loans

When shopping for private college loans or school loans, it’s best to compare student loans by using the Annual Percentage Rate (APR). The APR takes into account all student loan costs associated with the school loan such as finance charges and miscellaneous loan fees. The formula used for calculating the interest rate of the loan also takes into account variables such as deferment periods and repayment terms. Each of these variables can have a significant impact on the total cost of your school loan. The APR takes all of these variables in mind and gives you a true cost of borrowing for your education.

Additionally, since most college loan lenders don’t tell you what your actual interest rate will be until after you submit your application, APR examples help you understand the lowest and highest possible interest rates you may have for your loan.  You will have to use those numbers when comparing college loans because once you submit your application for a school loan, they run your credit and credit history.  So before applying, simply assume you will receive a rate somewhere between the lowest and highest rates advertised with that specific lender.

Update on Student Loan Programs

The Department of Education released an update on Student Loan programs in the summer of 2010.  Before July 1, 2010, Stafford, PLUS, and Consolidation Loans were made by private lenders under the Federal Family Education Loan (FFELSM) Program in addition to the federal student loan programs. As a result of the SAFRA Act, which was part of the Health Care and Education Reconciliation Act, no further loans will be made under the FFEL Program beginning July 1, 2010.

All new Stafford, PLUS, and Consolidation Loans will come directly from the U.S. Department of Education under the Direct Loan ProgramSM. For those students still enrolled in college and currently have a a federal student loan from a private lender, you will need to sign a new promissory note to receive loans under the Direct Loan Program.  Check with your school’s financial aid office for more detailed information.

Here is a notice from the Federal Student Aid Commission:

This change does not impact the process of applying for federal grants, loans and work-study or the amount of federal aid that students are eligible to receive. Students interested in receiving federal student aid should continue to complete a Free Application for Federal Student Aid (FAFSASM) for each school year that they wish to be considered for aid. If you have any questions about applying for federal student aid, please contact
1-800-4-FED-AID.