The cost of education continue to climb higher each year and as a result, many students have to borrow money to pay for the increased expenses. College expenses have vastly outpaced inflation rates for the past five years and currently do not show any sign of slowing down. Deciding on a loan can have long term implications on your finances, so it is important to understand the difference between government loans and private loans.
Federal Loans
Federal student loans are just that, education loans that are funded and backed by the federal government. These loans usually are the best first option for funding college. Interest rates are sometimes lower on federal student loans compared to private loans, and the loans often do not require co-signers or credit checks. Students have to reapply for federal funding each year and each loan may require fees that can add up over time. Federal loans also have several repayment options that can be dependent on your income and school status. Those payments are generally not due until after graduation and are considered to be in forbearance while the student remains in school.
Despite these advantages, federal loans do have some drawbacks that have to be considered. At this time, undergraduate loans have limits and loan requestors can only borrow up to a total of $57,500. Currently, the cost of a semester at a state college is approximately $30,000 with fees, tuition, room and board. Graduate students may receive up to $138,500 in federal loans. However, federal funds may not be enough to cover all student expenses. When this happens, privately funded loans may be the answer for you.
Private Loans
Private student loans can be funded through banks, credit unions or other online lenders, and can help cover education costs when federal funds just aren’t enough. Like federally funded loans, private loans can help cover tuition, fees, as well as room and board. Some private loans require a co-signer, but unlike federal loans, most private loans do not have origination fees, which means upfront savings.
United Heritage is proud to offer a variety of loan options for higher education. Our student loans can be used for either undergraduate or graduate education and like all of our other loans, we offer competitive interest rates. An application is easily done online and most borrowers can receive approval in mere minutes. In cases where a co-signer may be required, after 36 months of on-time payments, your co-signer can be released from the loan. Co-signers can also be invited to apply online in minutes when needed.
United Heritage student loans also offer several repayment options. Loans payments can be deferred, have interest only or immediate repayment. A loan specialist can help guide you through your best options for repayment. We also offer a discounted interest rate for automated payments! Depending on your need, you can borrow anywhere between $3,000 to $150,000 towards your education. Explore UHCU student loan offerings by clicking here.
