{"id":4259,"date":"2008-09-01T08:43:16","date_gmt":"2008-09-01T13:43:16","guid":{"rendered":"http:\/\/magic1host.com\/blog\/2008\/09\/01\/private-education-loans-to-supplement-federal-funding\/"},"modified":"2008-09-01T08:43:16","modified_gmt":"2008-09-01T13:43:16","slug":"private-education-loans-to-supplement-federal-funding","status":"publish","type":"post","link":"https:\/\/magic1host.com\/blog\/?p=4259","title":{"rendered":"Private Education Loans To Supplement Federal Funding"},"content":{"rendered":"
by Donald Saunders<\/div>\n

Most of the government student loan programs do not require a credit<\/a> check to be carried out and provide students with significant financial aid. These programs are however need based and usually carry additional criteria that may make it hard to qualify. Even when a student does qualify, the loans only cover a portion of the whole cost of education in many cases. When students are caught in this position then they could look to alternative student loans to make up the shortfall.<\/p>\n

Private alternative educational loans too have their own set of problems. A credit check is almost universally required and this is no problem as long as you have a good credit history. The problem is that ‘good’ is a relative term and if it is not good enough then you will find that you are paying more than the standard interest rates.<\/p>\n

In addition to the stated rate of interest there are further monetary implications of alternative loans. Fees will normally be added on to nominal loan amounts and a relatively modest loan of $3,000 might easily have 4% in fees added before distribution. That means that $120 of the total loan is not seen by the student but nonetheless must be paid back. As a very rough guide, 3% in fees is equivalent to an additional 1% added to the stated interest rate.<\/p>\n

But private loans do have certain advantages.<\/p>\n

The first and perhaps most obvious advantage is that money is readily available. Private lenders make their money from the interest and fees that they charge and so have an interest in making funds available to borrowers and will try very hard to see that every borrower qualifies for a loan. Government lenders by contrast are bound by a rigid set of criteria and there is frequently no real appeal if your loan application is turned down.<\/p>\n

Not having to deal with that cold and frequently irrational bureaucracy is another advantage of alternative loans. Private lenders have customer service departments that exist to deal with queries so that customers can get the answers that they need. Government loan programs generally have contacts and help available as well but the answers you get are hit or miss when it comes to quality.<\/p>\n

Other practical considerations which make alternative loans especially desirable include:<\/p>\n

The fact that parents and students do not have to fill out FAFSA (Free Application for Student Aid) forms and provide a lot of supplemental documentation. Alternative loan applications are simpler and the whole process is easier. However, fees and interest rates may be higher or lower according to the particular program.<\/p>\n

The best private loans have zero fees and rates of interest that are roughly equal to the prime rate. The ‘prime rate’ is the rate that banks charge one another or their biggest and special customers. Getting an interest rate at prime is a very good deal and getting a rate at 1% below prime is a truly great deal.<\/p>\n

In order to get this sort of loan it is generally necessary for you to have a very good credit history or to apply for the loan with a co-signer who has an excellent credit history.<\/p>\n

When all is said and done, the best way to discover whether an alternative loan is going to suit your purposes is to go out into the market and see exactly what is available.<\/p>\n

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About the Author:<\/div>\n
Visit TheStudentLoansCenter.com for information about college financial aid<\/a> including locating bad credit education loans<\/a><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Most of the government student loan programs do not require a credit check to be carried out and provide students with significant financial aid. These programs are however need based and usually carry additional criteria that may make it hard to qualify. Even when a student does qualify, the loans only cover a portion of the whole cost of education in many cases. When students are caught in this position then they could look to alternative student loans to make up the shortfall.<\/p>\n","protected":false},"author":1543,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[77],"class_list":["post-4259","post","type-post","status-publish","format-standard","hentry","category-business","tag-business"],"_links":{"self":[{"href":"https:\/\/magic1host.com\/blog\/index.php?rest_route=\/wp\/v2\/posts\/4259","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/magic1host.com\/blog\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/magic1host.com\/blog\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/magic1host.com\/blog\/index.php?rest_route=\/wp\/v2\/users\/1543"}],"replies":[{"embeddable":true,"href":"https:\/\/magic1host.com\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4259"}],"version-history":[{"count":0,"href":"https:\/\/magic1host.com\/blog\/index.php?rest_route=\/wp\/v2\/posts\/4259\/revisions"}],"wp:attachment":[{"href":"https:\/\/magic1host.com\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4259"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/magic1host.com\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4259"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/magic1host.com\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4259"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}