In general, there are two things that you should know about student loans: How to get them, and how to repay them. After you graduate and leave school, you may not have the money yet to repay the student loan which you have applied for to fund your education. Well, perhaps you really did not have the money since then, which is why you were hesitant to apply for loans. Before you pursue your degree through the aid of a loan, you should definitely know how student loans really work.
While you are still in school, you do not have to start paying for your student loans. Lenders sure understand that you cannot work full time and at the same time attend school. This apparently gives you the chance to focus on your studies while not having to worry about repaying your loan. It is only after graduation, or after quitting school that your grace period for repayment begins. For example, if you have applied for the Stafford Loans, you will only begin paying back the amount barrowed after your graduation. In fact, you will be given a grace period of six months after graduation. This gives you enough time to look for a job so you can have the financial resource to make the payments.
There are two types of student loan: the federal student loans and the private loans. When you are applying for a loan, it is highly advised that you take the federal loan instead. Federal loans do not give high consideration on your credit rating than private loans would. Moreover, because it is government-funded you have better repayment terms which typically have lower interest rates compared to private student loans. Nonetheless, you have to always remember that the amount of your loan could be mounting higher due to the interest rate. This means that, regardless of its source, loans could cost more than its original value from the time you are granted with it until you complete your payment. When paying for a loan, it is very important that you make your payment on time, or according to the repayment schedule. This is to avoid some serious financial consequences.