Federal College Loans

Federal student loans are offered by the Government to help you meet the growing costs of attending school. Federal college loans have vastly better rates than private college loans and should always be considered first.

There is a wide selection of loans available.

Federal Direct Student Loan Program (FDSLP)

This program includes the Federal direct Stafford loan; Federal direct PLUS loans and Federal direct Perkins loans shown below. Provided by the Department of Education the Federal Direct Student Loan Program is a part of the Federal student aid (FSA) program that is run by the Government. It requires that your school be participating in the FDSLP program and that you complete a master promissory note (MPN).

Federal Stafford Loan

This is the most common type of Federal loan and is available to undergraduate students. It is very low interest and like most Federal student loans can be obtained without a credit check. It normally allows a 6 month grace period. You must be currently be attending or planning to attend an accredited school or college and be studying at least half time.

Federal Parent PLUS Loan

The Federal parent loan for undergraduate students (PLUS) can be taken out by the parent of a dependant attending college, this can be an excellent way to help to supplement your financial aid package. As it is tied to the parent and not directly with the student it can be used in addition to other methods of school financing. They can be either obtained from a private lender or through the Government.

Federal Graduate PLUS Loan

As of July 1st 2006 the Parent PLUS loan was expanded by the Government. The Federal graduate PLUS loan was created and allows professionals and graduates to apply. The main difference between this and the Parent PLUS loan is that if you apply for the new PLUS loan and get refused you cannot get an increase of funds from your Stafford loan. This new loan is restricted to the financial gap you have. For example if your Stafford loan covers $10 and your attendance fees are $25 then the maximum amount you can apply for from a Graduate PLUS is $15.

Federal Perkins Loan

The Perkins loan is easily the best form of Federal loan available and should defiantly be considered as one of your first options. It is awarded only to students that show exceptional financial need and whilst the limited pool of money comes from the Government it is managed and approved by your school or college. Interest is paid by the Government whilst in college and during the 9 month grace period.

Whenever taking out any loan be sure to fully read the terms and conditions and be sure that it is the right option for your financial needs.