|
FEDERAL STUDENT LOAN FEATURES
|
PRIVATE STUDENT LOAN FEATURES |
|
Include many protections often not available from
private lenders, such as interest rate caps. A cap means the interest will
not exceed a specified
rate.
|
Offer variable interest rates that may change every year.
|
|
Usually offer a variety of ways to handle payments should personal circumstances make repayment difficult.
|
Private lenders are not required to provide repayment options should a personal circumstance make repayment difficult.
|
|
You don't have to start repaying your loans until you graduate or drop out of school.
|
Some private student loans require you to start making repayments immediately after you sign the loan agreement.
|
|
Students with financial need may qualify to have the government pay loan interest while they are in school.
|
Interest accrues while you are in school and you are responsible for paying the loan and the related interest and fees.
|
|
You don't need a credit record or a cosigner to get a federal student loan.
|
In some instances, a cosigner may be needed to obtain a student loan. In addition, without a credit record (which most students have not established yet), interest rates for private loans are usually higher than federal student loans.
|
|
If you have a dispute, you can bring your case to court.
|
If you have a dispute, most private loans require mandatory arbitration rather than allowing you to file your claim in court.
|
