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Federal School Loan

Federal or government student loans are the largest source of finance for college students in the US and one of the major loans is known as the Federal Family Education Loan Program or FFELP. Private student loans generally have higher interest rates and do not have the same level of flexibility or favorable terms as student federal aid loans. It is better to research other options first and only take out a private student loan if you need some extra money to cover expenses.

In order to qualify for a federal student loan, you must fulfil certain criteria, such as being a US citizen or eligible non-citizen and you should be enrolling on a degree or other eligible course. You should also have the right level of education to enter college, either through a high school diploma or approved homeschooling program.

You also need to keep up with your studies once you start colllege and will need to show satisfactory progress.

Why choose the FFELP? These loans - which comprise the Stafford Loan, Unsubsidized Stafford Loan, PLUS (Parent Loan for Undergraduate Students) Loan, and Consolidation Loan have a number of advantages which will make life easier for students and their parents, for example very favourable repayment terms. In fact, in some cases the government will even pay the interest while the student is still at college, which could be an enormous benefit.

Most students are eligible for a Stafford Student Loan, either subsidized or unsubsidized and many parents will qualify for a federal Plus Loan.

The most needy students will be entitled to a Perkins Student Loan, which has extremely favorable rates.

It may also be possible to defer the loan repayment until you finish your course and there are also possibilities for flexible repayment arrangements.

So, overall, this type of loan has quite a few plus points. You can get a guide to all the federal financial aid programs entitled "Guide to U.S. Department of Education Programs." on their website at FFELP.

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