Student Loan
A student loan is a type of financial aid borrowed from a governmental or private lender to help pay for education-related expenses, such as tuition, books, and living costs. Student loans must be repaid with interest, typically after the student graduates or leaves school. These loans often offer flexible repayment plans, but borrowing wisely and understanding the terms is critical to managing debt effectively.
Common Questions
What is the difference between federal and private student loans?
Federal student loans are funded by the government and typically offer lower interest rates and more flexible repayment options compared to private student loans, which are issued by banks or financial institutions and may have variable interest rates and fewer protections.
When do I need to start repaying my student loans?
Repayment of student loans generally begins after a grace period following graduation, leaving school, or dropping below half-time enrollment, which is usually six months for federal loans. Private loans may have different terms, so it's important to check with your lender.
Can student loans be forgiven or discharged?
Certain federal student loan forgiveness programs exist, such as Public Service Loan Forgiveness and Teacher Loan Forgiveness, which may discharge remaining loans after meeting specific criteria. Private loans, however, are less likely to be forgiven, so it’s important to explore options.