Finding A Good Student Loan Rate

The interest rate on a student loan is typically less than that of a conventional loan, but there may still be some variation among different lenders.  This is less true of the federal student loan programs, but is often the case with private student loans.  Regardless of the loan program you choose, it is in your best interest to obtain the best student loan rate possible.

Federal Student Aid
The federal government establishes interest rates for federal student aid programs.  The rate typically varies depending on the specific government lending program you use, sometimes with a spread of as much as two or three percentage points.  Rates are set for loans initiated during a given twelve month period, generally running from July 1st of one year to June 30th of the following year.

There are numerous loan and grant programs available from the government, with qualifications and terms that vary quite a bit.  Aid is available for students as well as parents of students who need assistance financing a child’s college education.  Interest rates are generally a bit higher for the parent loans than for the student loans.

Private Student Loans
This type of loan comes directly from the lender, separate from any government programs.  The interest rates are usually higher than federally administered programs, but it is usually easier to obtain a larger loan amount with a private student loan.  Terms and conditions can vary quite a bit from lender to lender, so shop around for the best rate as well as the best terms to meet your needs.

A good place to start is on internet.  Don’t stop with just a basic search, dig a bit deeper into the information lenders put out.  Once you have an idea of what’s available that way, make a visit to your local bank or credit union and ask about their programs.  Internet lenders work in high volumes so personal attention is somewhat limited; your local lender, on the other hand, is generally much more interested in providing personalized service to help you.