Federal Vs Private Student Loans: For any student who is going through some financial crisis, student loans come out as a big help to pursue their studies. There are mainly two types of student loans such as Federal and Private Student Loans. However, many prefer to go for a federal loan as it provides the best offers at low-interest rates. On the other hand, Private student loans are also popular among students as many private lenders offer few options to select between fixed and variable interest rates to their borrowers. There are many people who want to know how they can apply for these student loans. Therefore, in this article, we will provide you with detailed instructions on how you can apply for Federal and Private Student Loans.
How To Apply For Federal Student Loans?
All American citizens who want to apply for educational loans, particularly for federal loans in the United States, must first apply for the FAFSA application. However, before applying for FAFSA application, the applicants have to check their eligibility for Federal Student Loans. First, you need to qualify for all the requirements that are specifically set for students who want to apply for Federal Student Loans.
Eligibility Criteria & Requirements
If you’re looking to get a federal student loan, here’s the list of eligibility and requirements that you should check before applying:
- The applicant must have a valid Social Security number.
- Should be a U.S. citizen or eligible non-citizen.
- The candidates must have a high school diploma or equivalent like a General Educational Development (GED) certificate.
- For most of the programs, the applicants should demonstrate their financial needs.
- They must enroll themselves in an eligible school that accepts federal aid.
- Should maintain academic progress or at least a 2.0 GPA to continue the financial aid throughout their academic sessions in school/ college.
- The applicants must be enrolled at least half-time in order to be eligible for Direct Loan Program funds.
- During the process of applying for a Federal Student Loan, the applicant has to sign the certification statement stated on the Free Application for Federal Student Aid (FAFSA) form.
Here’s How to Apply For The Federal Student Loan
Many students want to know how they can apply for the Federal Student Loan, on the other hand, this process is very simple. First, you need to qualify for all the required criteria to become eligible for this student loan. To help you out, we have also mentioned the eligibility criteria & requirements of the federal student loan in this post. Once you qualify for all the requirements, then you can proceed to apply for Federal Student Aid (FAFSA) application.
While filling out the FAFSA application, you must take note that this process is completely free of cost to apply for federal student loans. If you are asked to pay any kind of fee during the FAFSA application process, then you must have landed on the wrong website. So, it is very important to visit the official site as there are many fake web portals that charge money from applicants.
The easiest and fastest way for filing the FAFSA is by applying the online method. Once you will submit the application, it will be processed within 3 to 5 days. You can also try to mail in a paper application; however, the process will probably take around 7 to 10 days for processing. Therefore, the online method is considered to be the best option due to its fast process. You can submit your FAFSA without paying a single penny.
As soon as you submit the FAFSA application, the school that you are deciding to attend is going to create a student aid report for you. This report is going to contain details regarding free aid like grants, scholarships, and work-study options among many more. After reviewing the offer, it’s up to you to accept any part of the offer that you want.
Additionally, the FAFSA is also responsible for controlling additional federal student aid such as grants and work-study. In order to get federal student assistance, the applicants must submit the FAFSA every year they are enrolled in their school/college.
How to Apply for Private Student Loans?
The process to apply for Private Student Loans is quite different from federal loans. Private student loans require a full underwriting procedure where borrowers’ credit scores and history will be evaluated. The lenders are usually looking for borrowers who have good credit and enough balance to make the repayment without any difficulty. Many lenders have their own setup rules and requirements that needed to be fulfilled by the borrowers in order to qualify for private student loans.
During the application process, the borrowers will be asked to provide documents to check their eligibility such as Bank statements, Personal IDs, Tax returns or W-2 forms from the preceding years, employment pay stubs, and a few more. If in case you have a cosigner, you’ll need to provide this information as well. Also, if you have existing student loans, then loan documents will be needed too.
The institutions or organizations that can offer you private student loans are Banks, credit unions, online companies as well as state-based agencies. As many private lenders provide different offers and benefits, you must make sure to check and compare interest rates, fees, and borrower protections before choosing a lender for your student loan.
This was all about Federal and Private Student Loans in this article. We hope you have learned about how to apply for federal and private student loans through this post. If you face any issue during the process, you can directly contact the official authorities or can ask us in the comment section. In the end, we will recommend you borrow as little as possible that can cover your tuition fee along with other educational upfront costs. As student loans are not free money, so borrowing a small amount will help you to pay them back the borrowed money without facing much trouble in the future.