Selecting Student Loans for College

RESTON, Va., July 13  /PRNewswire/ -- A college education is an invaluable investment in one's future. And, while media reports inevitably tout the increasing cost of going to college, they often fail to mention that financial aid also has increased. When it comes to getting a loan for college, in fact, roughly two-thirds of students look to low-cost student loans.

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"Students should first consult with their financial aid office for recommendations on student loan options and lenders," says Martha Holler, a spokesperson for Sallie Mae, the nation's leading provider of education funding. "Most offer a list of lenders that they recommend to their students as offering excellent rates and terms and providing excellent customer service."

Federal student loans, like those offered by Sallie Mae, are the most common way for students and families to finance a college education. Federal student loans are available on both a financial need and non-need basis. And while these loans typically have borrowing limits, they offer the most attractive terms; lower interest rates, subsidized interest in certain cases; the ability to postpone making payments; longer repayment terms; and less stringent credit requirements.

Some lenders also offer additional borrower benefits such as loan balance reductions for paying on time and reduced interest rates for signing up for automatic debit and making payments electronically.

PLUS Loans are another college-funding option.  A PLUS Loan is a low- interest federally funded loan for credit-worthy parents of undergraduate, dependent students as well as for graduate and professional students.  The PLUS Loan will cover the entire cost of education, including books and living expenses.

For students and families who find that federal programs are not enough to cover the cost of college, private loans can help.  Private loans are designed to supplement federal loan programs and are available from schools, banks, and education loan organizations. The terms of these loans vary based on the lender and the credit history of the borrower or co-borrower.

Sallie Mae's "How to Pay for College: A Practical Guide for Families" offers additional insight on selecting a student loan. Written in collaboration with financial aid administrators, the book devotes several chapters on student loan options, as well as tips on successful repayment.

"Loans should be taken out after a student has fully exhausted all other options, such as grants and scholarships, that do not need to be repaid," Holler adds. "The bottom line: There are many low-cost funding options for students and their parents to cover the cost of college, making higher education within reach of anyone who desires it." 

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DATASOURCE: Sallie Mae



CONTACT:  Erin Korsvall of Sallie Mae, [phone]



Web site:  http://www.salliemae.com/



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