Government backed student loans certainly have their merits because they enable a lot of people to pay their way through college. However most people find that private student loans are generally more beneficial, for various different reasons.
First of all there is the fact that private student loans can be for a much larger amount, which is a major bonus. They are also very convenient because you can apply for them at any time of the school year and the actual amount of the loan will be sent to you directly instead of the university where you will be studying.
You will surely have noticed that the cost of going to college continues to rise every year. So it pays to have easy access to some much needed funds during your four year stay. Federal loans are often a lot smaller and only tend to cover some of the costs that you will face during your time at college. It is the parents that often need to fork out the rest, but with a private loan you can get the money you need because you should have no problems paying this extra amount back once you graduate and get a well paid job at the end of it.
There is actually no upper limit when you apply for a private loan. This doesn't mean that you should borrow as much as you possibly can, and have a lot of fun during your college years. However what it does mean is that you should be able to afford the higher fees should you choose to go to one of the best colleges, which are of course the most expensive. You can also pay for any remaining expenses such as accommodation, books, tuition fees and day to day living expenses.
Not everyone has the financial means to go to one of the top colleges if they come from a poor background. A government loan certainly isn't sufficient to pay the yearly fees in most cases. However a private student loan enables anyone to fulfill their dreams.
The reality is that having a degree from a major university will give you a head start over many other applicants because businesses, rightly or wrongly, often favour those people who have qualifications from these top institutions. Indeed some companies will throw your application form straight in the bin and not even consider giving you an interview unless you have a degree from a top college, even if you have top grades.
Another great thing about a private student loan is that they can be really flexible. The lending company will often give you a six month grace period after you graduate before you need to start making any repayments. This will give you time to find a job and get yourself sorted.
It pays to do some research and compare many different offers, because each loan will have different interest rates, different repayment terms and different fees and expenses. It can be quite a daunting experience applying for one of these loans and taking on so much debt at such a young age. However I would say that it's definitely worth considering getting a private student loan because they allow you to borrow more money so you can attend whatever college you want, which is probably worth the extra financial burden.
Click here to find out more about some of the best student loans for college and to find out how you can get student loans without a cosigner.
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