How to Find Low Interest Rate Student Loans

Low interest rate student loans might not seem like the highest priority when you are still in school because repayment is often something you don't have to worry about until after your graduate or leave school.

Unfortunately, those years go faster than you would expect, and the interest rate on your student loan can mean the difference between a manageable payment and one that keeps you worrying about your monthly budget. Finding low interest rate student loans takes a little time and effort, but it is worth it in the long run.

Finding Low Rates

To obtain a low interest rate, you'll want to focus your search first on those loans that are guaranteed by the government, like Stafford, Perkins, and Direct loans. There are other options. Alternative or private loans offer competitive rates as well as incentives like graduation bonuses and interest rate reductions for on-time payments. Most banks offer student loan products; check with your local bank to determine which products they offer.

Federal Student Loans

To obtain federal student loans, you must complete the Free Application for Federal Aid (FAFSA). The FAFSA is required by every college, university, or institute of higher learning that accepts Federal financial aid.

Private or Alternative Student Loans

In addition to your local bank or credit union, many online lenders offer private student loans at reasonable rates. These loans can help bridge the gap between what federal loans will pay and the cost of your tuition.

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