Now that you have graduated from High School and you are definitely looking forward to your next adventure in life. College can be a great time in your life if everything is set up so you can pay for your schooling. Grants and scholarships can be helpful but what do you do for those additional monies you will need to get through the four years till you graduate. Student loans can help finance your future and are more popular now than they use to be. It seems that companies are more willing to lend money to students than they did in the past.
If you are considering a student loan, you will be required to have a co-signer. This is normal for any type of private student loans because the amount you can borrow is based on your credit score or credit rating. The reason you will need a co-signer is because you have not had enough time to develop a credit score that will qualify for a loan sufficient enough to pay for your college tuition. When you have a parent with a good or high credit score as a co-signer on your note you will be able to get a higher loan amount, along with a lower interest rate for the money. It is even possible to extend the loan over a longer period at the lower interest rate.
Due to the state of the economy now in 2009, it is even tougher to borrow or qualify. It is important that the parent has very good credit or the lender will deny the borrower at this period of time. In the past, it was easier to qualify, but now it is harder due to the requirements in qualifying for the money. The repayment options are not as liberal as they were in the past and are even stiffer than before. It is important that you and your co-signer understand that private student loans are not regulated in the same way that government student loans are. Before you sign on that dotted line, understand exactly what type of money contract you are getting as well as the requirements for repayment of private student loans. If there is any confusion, consult with an attorney to protect your interests.
The other point is that private student money notes tend to have a higher interest rate than the federal government school loans. The rate can also be variable. This means that the rate will change on the loans depending on the economic markets. The good thing is that in most cases the interest rate is tied to the PRIME lending rate, which can make private student lending a bit risky in 2009 economic times.
In conclusion, you are moving forward in your life after High School and are looking forward to college. This will most likely be the one of the greatest times of your learning career. It was for me and I hope it will be for you. If you are looking into financing now, because you did not get a full scholarship or grant, a government or private lender is the way to go for the money. It will not be as easy as it was in the past to borrow money, so research all lenders and see who has the best repayment options. The Interest rate generally is tied to Prime but that could change tomorrow because of the housing crisis. Remember one thing, if you are confused or not too sure about the terms of the contract, consult with an attorney to protect your interests.