Federal Student Loans

Written by Ingrid Chen
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If you have ever thought about going to college but thought you couldn't afford it, you might want to think again. Granted, college is now more expensive than it ever has been. However, there are certain loans that you can apply for that are specifically for education beyond the high school level. These are known as federal student loans. Before you are approved, you have to show that you need financial assistance.

The money for these loans comes directly from the government. They are much less expensive than a private loan from a bank. In addition, you have more time to pay them off and can perhaps receive grace periods if you go back to school. There are four kinds of federal loans. They are Stafford subsidized, Stafford unsubsidized, PLUS and consolidation.

The Four Loans

The federal Stafford subsidized loan is great because the government pays the interest while you attend school. With some, they will also pay the interest for six months after you graduate while you get your feet on the ground. As you may have guessed, the interest is paid by you with the unsubsidized loan. For this loan, you don't have to demonstrate financial need as you do with the subsidized one.

The PLUS loan is only available to parents of dependent students. Dependent students are any students who do not fall into the independent categories. Independent students are 24 years old or older, a ward of the court, married, a veteran, an orphan, a graduate or professional student or have legal dependents other than a spouse.


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