Great Lakes Student Loan Services, Reviews, Information & Guide

Great Lakes Higher Education Services usually also known as “Great Lakes” provides federal Student Loans services. Since 1967 Great lakes have been helping students & Parents to complete their Higher Education.

Great Lakes & its Affiliates work hard to match eligible borrowers with lenders who can provide the loans they need to cover the costs of college Tuition for Students.

Great Lakes is the most popular & Largest Loan Servicer in the United States of America. Great lakes own the federally guaranteed Students Loan Services of United Student Aid Funds.

Great Lakes offers standard payment Plans, where you pay a set dollar amount each month as well as Income-based repayment Plans, where your Monthly Payment differ according to your recent Income. There are various ways to pay including online, by phone, or through the Company’s Mobile Apps.

If you are not aware of Federal Student Loans and are not sure what is the best Repayment Strategy is best for you. then great lakes are the Online service for you.

Also, there is a Knowledge Center where you can find answers to your Common question regarding Student Loans, and their Repayment Planner can you help to determine the smartest payment Schedule for you. And if you have any problem You can Contact Great lakes from Monday to Friday and its expert will solve your problem.

Great lakes Primary service and its Important Function is to give you access to your Student Loan Account. As a guarantor of the Federal Student Loan, Great lakes has obligation to both you and the Government.

Great Lakes has partnered with a large no of Lenders, both private & public which provide low-cost education Loans to college-going Students.

Great Lakes Education Loan Service specializes in managing the Backend of the Loan process. They Act as the Direct Contact between Students and Lenders throughout the Life of a college Loan.

Great lakes help Student Borrowers with all aspects of their Education Loan, making payments, monitoring the outstanding balance, & tracking occurring interest.

Also, Great lakes help Students to take advantage of potential Tax benefits and Apply for Student Loan Consolidation programs & more.

About Great Lakes

The Great Lakes Organization or Firm has been ruling the Market for a Good time Now. The Company is accompanied by Good Loan History for Millions of Parents and Students. Great Lakes Company is able to offer Student Customers Access to a $ 244 billion business Volume through subsidies and Grants.

Mygreatlakes has more than 8 million customers all over the World. Also, the Company has nearly 75 billion in Loan guarantees for the federal Family Loan Program. To Date, the Company has invested around $ 260 million in various scholarship Programs.

Great Lakes Student Loan Services

Many students have taken out federal student loans recommended to them by their school’s financial aid office without understanding exactly what types of loans they’re using, or why those loans rather than others were chosen for them.

The Student Loans section gives a little introduction to the Direct loans that most students receive, explaining the differences between subsidized, unsubsidized, and PLUS loans.

There’s an explanation of when you must pay the interest on your loan and several paragraphs on changes in loan status that trigger required repayment.

In general, enrollment of at least half-time means repayment is not mandatory, although if your loan is unsubsidized choosing not to pay interest will add that interest to the principal balance of your loan. You can find more on the types of federal loans here.

Great Lakes Student Loan Reviews

Great lakes are the Loan Servicer Works with Students, Graduates, Parents, & lenders to Ensure Successful Student Loan Repayment.

Great lakes offer various options for you who want to Pay Back Your Student Loan. The Standard Repayment Plan Charges you a monthly payment over a 10 Year Period. But if it does not work for you then there are other options are available for you.

Income-driven repayment provides you to Pay Less when you have a low monthly Income and more when your Income is High. For those who forget Payment frequently and looking to save little, enrolling in automatic payments will result in a 0.25% Interest rate deduction and Save your money in Long Run.

Price Varies by loan amount, interest rate, etc.
Best For Anyone looking to take out a student loan
Not For People who don’t need a student loan
Loan Terms 10 – 30 years
Repayment Options Standard, Income-Driven, Deference, Forbearance
Better Business Bureau Rating A+
In Business Since 1967
Standout Features Extensive educational resources
Discounts for auto-paying
Flexible payment options

About Mygreatlakes

MyGreatLakes Recognizes the Significance of College degrees for Achieving Success and assists Young people in Achieving their Dreams by offering Student Loans to Millions of Students in the United States of America. with the assistance of Mygreatlakes, Higher Education has been very easy for Students and Parents that are facing some financial difficulties.

MyGreatLakes.Org acts as the intermediary between Students and Education Loan Providers as the Single Point of Contact for Borrowers seeking all Details about their College Loans. www.MyGreatLakes.org is one of the best Portals for Students who wish to Clear their Due Loans and want to Achieve their Dreams. No Students need to Give up on their dreams just because of a Lack of financial resources.

The Great Lakes Student Loans Interest Rates

The interest rate on the federal student loan is given by the Federal Government and is serviced by private companies like Great Lakes.

Congress decides the interest rate on Federal student loans every year based on the Financial Market. The Great Lakes Student Loans Interest Rates vary depending on the type of loan.

The rates are not based on the credit score or the ability of the borrower to repay them. All federal student loans have got a fixed interest rate on them and they do not change throughout the tenure of the loan.

Loan Type Borrower Type Interest Rate
Direct subsidized/unsubsidized Undergraduate 4.45%
Direct unsubsidized Graduate 6.00%
Direct PLUS Graduate, Parents 7.00%
Perkins Loans Undergraduate, graduate 5.00%

The amount of interest rate you will have to pay depends on the factor of whether your loan is subsidized or unsubsidized.

Great Lakes Student Loan Cost & Its Payment

The cost of a student loan differs depending on how much you borrow, your interest rate, repayment terms, and in some cases, your credit score. The only way to know how much it’s going to cost you is to explore multiple options before making any decisions.

If your loan has been assigned to Great Lakes, use its Repayment Planner tool to help you determine which option best fits your lifestyle. Don’t just look for the minimum monthly payment, though, unless that’s all you can afford.

Paying more than the minimum is going to help you pay off your loan faster, and it’ll lessen the amount of interest you’ll have to pay overall.

Look at how much you’ll pay out over the lifetime of the loan and choose the option that costs the least, while still keeping the monthly payments affordable.

Great Lakes Student Loan Login

If You’ve Great lakes Student Loan, then the easiest way to make Payments is through their Online Portal at www.mygreatlakes.org.

You Can Start by creating mygreatlakes Account online for that you need to share your Social Security Number & Date of Birth so You can Retrieve your Loan Information. then you have to create your Username & Password in order to login to make Payments.

Great Lakes Student Loan Deferment

Great Lakes Student Loan Deferments are available for a variety of situations, including when you’re:

  • Back in school at least half-time.
  • Unemployed, or working less than 30 hours a week and looking for full-time work.
  • Temporarily having difficulty making ends meet.
  • Actively serving in the U.S. military during a war, military operation, or national emergency.
  • Actively serving in the Peace Corps or AmeriCorps.
  • In a graduate fellowship program or rehabilitation training.

To qualify for a deferment, you must meet certain requirements; however, once you meet the requirements, you can’t be turned down.

Great Lakes Student Loan Consolidation

Consolidation gives you the opportunity to choose one of the U.S. Department of Education’s consolidation servicers (of which, Great Lakes is one) to complete and service your Direct Consolidation loan.

The U.S. Department of Education made the landmark decision to allow you to choose your consolidation servicer (of which, Great Lakes is one) under the Direct Consolidation Loan program.

The Great Lakes Loans Form

Download Tax Form: A Tax Credit is the Reduction of the money of the Federal Taxes you owe to the Federal Government. Even though the Credits available to the user differ based on eligibility and the amount, they do one thing-reduce the amount so taxes that you have to pay.

For Student Loans Tax, Form 1040 is needed to be filled out by US Residents. You need to Download it from here – https://www.irs.gov/pub/irs-pdf/f1040.pdf

Great Lakes Mobile Apps

Now You Can Manage your loans with your Mobile Device. All of Your information is secure with Their Identity Confirmation Process and Robust Encryption Technology.

You Can Do the following Tasks with Great lakes Mobile Apps:

  • Make or schedule student loan payments of any amount
  • View account details like your balance, interest, lender, status, and payment history
  • Receive payment reminders and confirmations
  • Use an existing payment account or create and store a new one
  • Allocate any excess payment amounts to a specific loan or loans in an account
  • Send your proof of income documents for income-driven repayment plan requests
  • You can sign up for Great Lakes account access in-app if you need to; no need to visit their website to get started managing your loans.

Great Lakes Student Loans Contact Information & Phone Number

Need to get in touch with Great Lakes about your student loans? Don’t fret. There are numerous ways to contact them.

Office hours: Monday through Friday, 7 a.m. to 9 p.m. CT

Phone Number: 800-236-4300
Fax: 800-375-5288
Email: borrowerservices@glhec.org

Social Accounts: 

Twitter
Facebook

Mailing Address: 

Great Lakes
P.O. Box 7860
Madison, WI 53707-7860

Also, You can fill out the complaint form on their Official website – https://www.mygreatlakes.org/educate/contactUs/home.html

Final Verdict

If you have Great Lakes student loans, make sure to leverage their resources to help you pay off debt. If at any time you are having trouble Making Payments, get in touch with them to discuss your options.

Types Of College Loans: Federal Student Loans For Career Are An Investment In Your Future

Student Loans In the United States are designed to help make colleges more affordable for students and their parents. College Loans are a form of financial ad used to help Graduate or Undergraduate Students to access their education.

College Loans/Student Loans play a major role in higher Education In the United States. Every year approx 20 million Americans attend College for that 20 million close to 12 million or 60% borrow annually to help cover costs.

Student Loans are funds provided to a Student for Educational expenses and are considered self-help financial ads because you need to repay the money loaned to you.

Student Loans may be used for any college-related expenses which included Tuition, Room and Board, Study Books, Computers, and Transportation Expenses.

Student Education Loans come in several varieties in the United States but are basically split into Federal Student Loans and Private Student Loans.

The Federal Student Loans for which FAFSA is the Application are Subdivided into subsidized and Unsubsidized Loans. Federal student loans are subsidized at the undergraduate level only.

A Subsidized Loan is by far the best kind of Loan, but an Unsubsidized federal student loan is far better than a private student loan. Some states have their own loan programs, as do some colleges.

In almost all cases, these student loans have better conditions – sometimes much better – than the heavily advertised and expensive private student loans.

Federal Student Loans are the Investment in your Future you should not be afraid to take out Federal Student Loans and you need to be smart to take them.

There are lots of benefits and Advantages offered by Federal Student Loans compared to other options you may consider when you pay for College:

Features, Benefits & Advantages of College Loans- 

  • The Interest Rates on Federal Student Loans are almost always lower than that on Private Student Loans—and much lower than that on Credit Cards!
  • You don’t need a Credit Check or a cosigner to get most Federal Student Loans.
  • You don’t need to begin Repaying your Federal Student Loans until after you leave college or drop below half-time.
  • If you demonstrate financial need, you can qualify to have the Government Pay your Interest while you are in school or College.
  • Federal Student Loans May Offer Flexible Repayment Plans and options to postpone your Loan Payments if you’re having trouble making Payments.
  • If you’re working in Certain Jobs, you may be eligible to have a portion of your Federal Student Loans forgiven if you meet certain conditions.

Things You Know Before Taking Out Federal Student Loans-

Before Taking federal Loans you need to know that the Loan is a legal obligation that you will be responsible for Repaying with Interest.

You may not have to begin Repaying your Federal Student Loans right away, but you don’t have to wait to understand your responsibilities as a borrower. As a responsible borrower You need to:

  • Keep track of how much you’re borrowing. Think about how the number of your Loans’ll affect your future Finances, and how much you can afford to repay. Your Student Loan Payments should be only a small percentage of your salary after you graduate, so it’s important not to borrow more than you need for your school-related expenses.
  • Research starting salaries in your field. Ask your school for starting salaries of recent graduates in your field of study to get an idea of how much you are likely to earn after you graduate.
  • You need to understand the terms of your loan and keep copies of your Loan Documents. When you sign your Promissory Note You are agreeing to Repay the Loan According to the Terms of the Note even If you don’t complete your education, can’t get a job after you complete the Program, or you didn’t like the Education you received.
  • You are required to make payments on time even if you don’t receive a bill, Repayment Notice, or a reminder. You must pay the full amount required by your Repayment Plan, as Partial Payments do not Fulfill your Obligation to Repay your Student Loan on Time.
  • Keep in touch with your Loan Servicer. Notify your Student Loan Servicer when you’re Graduate, withdraw from school, drop below half-time status, Transfer to another school or change your Name, Address, or Social Security Number. You’re also able to contact your Servicer If you’re having trouble making your Scheduled Loan Payments. Your Servicer has several Options available to help you keep your Loan in good standing.

How to Apply For a Federal Student Loan (College Loans)-

Applying for Federal Student Loans looks like a daunting process but it’s actually Very Simple and can be done mostly Online.

To make it easier, we’ve provided the Complete Step By Step Application Process For College Loan Below:

  • First, you’ll need to start It by completing a FAFSA Form (or Renewal FAFSA for Returning Students). This form is required for both Current and Prospective US College Students (Undergraduate/Graduate) to determine their Eligibility for Financial Aid. It can be completed online and submitted directly to the Department of Education for Review.
  • The Student receives the Financial Aid Award Letters anywhere from 3 days to 6 weeks after submitting their FAFSA. Each letter will outline all of the Relevant Information regarding the Financial Aid Package being offered.
  • Upon Receiving these Letters, The Student will contact their chosen School’s Financial Aid Office to Accept the Student Loan Package being Offered.
  • Once The Student Loan Package is accepted, The Student will simply Review and sign any necessary paperwork associated with the Loans, such as a Master Promissory Note.

Types of Student Loans (Education Loans)-

There are two major sources of Student Loans i.e Federal Student Loans And Private Student Loans. There were 21 Million Student Enrolled in the College in the Universities this year and 8 Million of them receive Federal Student Loans William D. Ford Federal Direct Loan Program which includes Direct Subsidized Loans, Direct Unsubsidized Loans, Direct PLUS Loans, and Direct Consolidation Loans.

College Loans come in many shapes and sizes and the regulations for them can be different for them. Federal Student Loans are made directly from the Department of Education to the Borrower.

These Loans Cover the full academic years and be distributed in two payments, One each semester. With the Federal Student Loans, The School determines the types of Student Loans and How much you can borrow.

The loans may only be used to cover tuition and direct cost of living expenses. All Payments must be made either directly to the School or the Department of Education.

There are limits on how much you can borrow based on whether the Loan is Subsidized or Unsubsidized and whether it’s for Undergraduate or Graduate Study.

1. William D. Ford Federal Direct Loan Program-

The William D. Ford Federal Direct Loan Program is the largest Federal Student Loan Program which is made up of four Different Types:

  1. Direct Subsidized Loans: These loans are designed for Undergraduate Students with Financial needs. The Student is not able to be liable for the Interest on the Loan while Attending School or in any deferment Periods. You can take out up to $5,500 each year to pay for the School. Unlike other loans, you’re not charged interest on the loans while you are studying in the School. All the Interest on the Loan is Paid by The Department of Education while you’re in school (at least half-time), during your grace period, and during any period of deferment.
  2. Direct Unsubsidized Loans: These Loans are able for Undergraduate, Graduate, and Professional Degree Students. The parent would be responsible for the Interest on the Loan from The First Month. The Lender is the Department of Education, to which all the Loan Payments would be made. The Direct PLUS Loan for Parents has a maximum Lending Size equal to the cost of Attending College Minus and other Financial Aid the Student has to be Received. You can take out a maximum of $20,500 Every Year to Pay for The College, School, and Interest accrues on your account while you’re Studying in the School.
  3. Direct PLUS Loans: These Loans are Able for both the Parents and the Students. The parent would be responsible for the interest on the loan from the first month. The lender is the Department of Education, to which all the Loan Payments would be made. The Direct PLUS Loan for the Parents has a maximum Lending Size equal to the cost of attending College minus and other Financial Aid the Student has to be received. The Lender for Direct PLUS Loans for Graduates is the Department of Education, to which all the Loans Payments would be made. The maximum Lending Size is the Cost of Attendance Minus any other Financial Aid the Student has received. You can use a Federal Direct PLUS Loan to cover the Total Cost of Attendance.
  4. Direct Consolidation Loan: If you have other forms of federal loans, you can consolidate them into one loan and one easy payment with a Direct Consolidation Loan. And, if your current federal loans are ineligible for PSLF, you can consolidate them with a Direct Consolidation Loan to qualify. The Direct Consolidation Loans are fixed-Interest Loans with Flexible Options, based on your Ability to Repay. There is no fee to Consolidate, though you can only do it once. It could lower your monthly payments, but also could extend the amount of time needed to pay off the loan.

2. Federal Perkins Loan –

Federal Perkins Loans are used for Undergraduate, Graduate, And Professional Degree Students with Financial needs. Perkins Loans have lower Interest Rates than other loans. Eligible Borrowers get Perkins Loans at 5% Interest.

These Loans are dependent according to your Financial needs and the availability of funds at your chosen university. The Perkins Loans were more desirable than Stafford Loans because they were subsidized (the government paid the interest while you were in school) and had a fixed interest rate of 5%.

Other advantages of the Perkins Loan included a longer Grace Period (nine months) before Repayment began and special loan forgiveness provisions.

Because of their favorable terms, Perkins Loans were reserved for students who show exceptional financial need. The loans were granted by a college and not all schools participated.

3. Stafford Loans-

These Loans are More common than the Perkins Loans and the money for these types of Loans comes directly from the Federal Government in the program called the Federal Direct Student Loan Program (FDSLP).

There are two types of Stafford Loans i.e. Subsidized and Unsubsidized. The type helps determine your Interest Rate and Maximum Loan Amount.

  1. Subsidized Stafford Loans:  If your loan is subsidized, you won’t be responsible for making any payments until after you graduate. Your interest rate typically should be 3.76% in a school year. The government pays your interest for you while you’re in school. Subsidized loans are reserved for students who can demonstrate financial hardship. Most go to students whose families’ annual income is less than $50,000.
  2. Unsubsidized Stafford Loans: If you have an Unsubsidized Loan, you’re Responsible for Paying off all the interest. And The interest rates were fixed at 3.76% while you’re in school, but Payments are typically deferred or postponed until after you graduate. All the Students are Eligible for these Types of Student loans. Your Annual Stafford Loan Limit for Unsubsidized Loans Ranges from $5,500 to $12,500, depending upon your School Year and whether you are claimed as a dependent on someone’s Tax Return. You’re Eligible for the Larger College Loan if you’re Financially Independent. If you’re Financially Dependent but your Parents are Ineligible for Parent PLUS loans, you’re Permitted the Same Maximum College Loans as if you were Independent.

4. Private Student Loans-

These Loans are also known as the Alternative College Educational Loans which are the option for both Students and Parents who still can’t meet Financial Obligations for Attending the College even with money Available through the Federal Loans.

Private Student Loans are the More Closely Resemble Personal Loans than Student Loans and Parent Loans. You’re Eligibility and Interest Rate depend on your Credit History.

Your Interest Rate for these Loans may be Fixed or Variable and is Typically Higher than with Federally Guaranteed Education Loans but Lower than with other debts like Credit Card debt. Private Student Loans are generally Two Types:

  1. School-Channel Loans:  These Loans offer borrowers Lower Interest rates but generally take longer to process. These Loans are certified by the Schools which means the School signs off on the borrowing amount, and the Funds are disbursed directly to the School. The Certification means only that the School Confirms the Loan Funds will be used for Educational Expenses only and agrees to hold them and disburse them as needed. Certification does not mean that the school approves of, recommends, or has even examined the terms (conditions) of the Loan.
  2. Direct-To-Consumer Private Loans: are not certified by the School and Schools don’t Interact with a direct-to-consumer Private Loan at all. The student simply Supplies Enrollment Verification to the lender, and the Loan proceeds are disbursed directly to the Student. While direct-to-consumer loans generally carry higher interest rates than school-channel loans, they do allow families to get access to funds very quickly in some cases, in a matter of days. Some argue that this convenience is offset by the risk of student over-borrowing and/or use of funds for inappropriate purposes since there is no third-party certification that the amount of the loan is appropriate for the education needs of the student in question, or that it will be used only for education.

5. Health Professions Student Loans (Medical Education Loans)-

Medical Education Loans are specialized Student Loans that Exist for Students who are Studying in specific areas of Medicine such as Nursing, Sports Medicine, or Veterinary Medicine. Each Loan has its own Requirements for Accepted Areas of Study and Financial Needs.

Despite your Financial Standing or Field of Study, you can find an Education Loan that suits your Needs. It can help you and your family to fund your Higher Education and reduce the Financial burden of School or College.

Education Loan Breakdown-

Check out the below Table for a breakdown of each Type of Student Loan and Its Current Interest Rate.

Loan Need-Based? Subsidized? Sponsor Borrower Interest Rate (Loans disbursed after July 1, 2017)
Direct Subsidized Loan Yes Yes Federal government Student – undergraduate 4.29% (fixed)
Direct Unsubsidized Loan No No Federal government Student – undergraduate 4.29% (fixed)
Direct Unsubsidized Loan No No Federal government Student – graduate/professional 5.84% (fixed)
Perkins Yes Yes Federal government Student 5% (fixed)
Direct PLUS Loan No No Federal government Parent (or graduate/professional student) 6.84% (fixed)
State and Private Loans No No Banks, colleges, foundations, state agencies Usually students with a creditworthy cosigner Usually higher than federal rates; variable

Difference Between The Public Student Loans And Private Student Loans-

  • The Interest Rates on Federal Education Loans are Fixed. The Interest Rates on The Private Student Loans can be variable or fixed and are usually higher.
  • Undergraduate borrowers who can demonstrate financial need could receive a federal subsidized loan, meaning the government pays the interest until you graduate. Private loans are never subsidized. You pay all the interest.
  • Federal loans offer flexible repayment options and loan forgiveness programs. Private loans have few repayment options and no loan forgiveness programs.
  • Federal loans don’t have to be repaid until you graduate or drop below half-time status as a student. Many private loans ask for repayment while you’re still in school.
Federal Student Loans Private Student Loans
You will not have to start repaying your federal student loans until you graduate, leave school, or change your enrollment status to less than half-time. Many private student loans require payments while you are still in school.

 

The interest rate is fixed and is often lower than private loans and much lower than some credit card interest rates. View the current interest rates on Federal student loans. Private student loans can have variable interest rates, some greater than 18%. A variable-rate may substantially increase the total amount you repay.
Undergraduate students with financial needs will likely qualify for a subsidized loan where the government pays the interest while you are in school on at least a half-time basis. Private student loans are not subsidized. No one pays the interest on your loan but you.

 

You don’t need to get a credit check for most federal student loans (except for PLUS loans). Federal student loans can help you establish a good credit record. Private student loans may require an established credit record. The cost of a private student loan will depend on your credit score and other factors.
You won’t need a cosigner to get a federal student loan in most cases. You may need a cosigner.

 

Interest may be tax-deductible. Interest may not be tax-deductible.
Loans can be consolidated into a Direct Consolidation Loan.  Learn about your consolidation options.

 

Private student loans cannot be consolidated into a Direct Consolidation Loan. 
If you are having trouble repaying your loan, you may be able to temporarily postpone or lower your payments. Private student loans may not offer forbearance or deferment options.
There are several repayment plans, including an option to tie your monthly payment to your income. You should check with your lender to find out about your repayment options.
There is no prepayment penalty fee. You need to make sure there are no prepayment penalty fees.
You may be eligible to have some portion of your loans forgiven if you work in public service. Learn about our loan forgiveness programs. It is unlikely that your lender will offer a loan forgiveness program.
Free help is available at 1-800-4-FED-AID and on our websites. The Consumer Financial Protection Bureau’s private student loan ombudsman may be able to assist you if you have concerns about your private student loan.

Top Federal Loan Servicers-

  • FedLoan Servicing (also known as PHEAA): This company was established to directly support the US Department of Education in the servicing of federal student loans.
  • Great Lakes: This is the Non-Profit Organization that is dedicated to helping College Students by working with both the US Department of Education and Private Lenders to make every step in the Borrowing and Repayment Process Easier.
  • Navient: One of the select groups of Companies chosen to Service Student and Parent Federal Loans by the US Department of Education. Their loan Servicing Department helps Customers through both Financial Literacy Tools and broad-based Servicing.
  • Nelnet: This Company works with the US Department of Education in assisting Borrowers through every Stage of their Loan’s Life Cycle: during School, during their Grace Period, and Throughout the Education Loan Repayment.

Federal Student Loans Benefits, Types, How To Apply & Complete Guide

Student Loans in the US or Federal Student Loans are a form of Financial ads designed to help Students & Parents to get their higher education.

Federal Students Loans are different from Private Students Loans. Federal Students Loans are made by the department of education while Private Students Loans are made by banks & Financial Institutions. federal Student Loans are likely to be your best Student Loan Option.

They offer more generous borrowers protections than Private Student Loans do, such as the ability to switch to an income-driven plan if you can’t afford your monthly payment or to defer payments if you lose your Job.

Federal Student Loans are made directly from the Department of Education to Borrower. Federal Student Loans cover full academic years and are distributed in two payments, one each semester. With Federal Student Loans, School determines the type of Student Loan and how much you can borrow.

These Loans may only be used to cover Tuition and direct costs of Living expenses. all the Payments must be made either directly to the School or the Department of Education.

Federal Student Loans Benefits, Types, How To Apply & Complete Guide

The Fee Application for Federal Student Aid or FAFSA is the Application for all the Federal Student Loans. The Federal Student Loan Programs are highly regulated by the Department of Education, United States.

Also, the Interest rates and many more important Terms and Conditions are also Set by the Department of Education USA, which is similar to both FFEL and Direct Loan Programs.

Direct Loans and Federal Family Education Loans (FFEL) are two Largest Govt Education Loan Programs. Knowing and Understanding the Interest rate of your Federal Student Loans is a very Important Step in navigating the Path to Financial Success.

Eligibility for federal student loans is based on the results of your FAFSA. There are several benefits of federal student loans:

Federal Student Loans Benefits & Features-

  • Lower fixed interest rates
  • Income-sensitive repayment plans
  • Deferment periods
  • Forgiveness options
  • No credit checks are required (and loans are NOT based on creditworthiness)

Federal Student Loans Types –

Federal Student Loans are categorized into several types:

Direct subsidized loans or subsidized Stafford loans –

These types of Federal Loans are earmarked for Undergraduate borrowers with financial needs. Direct Subsidized Loans are not accrued Interest while you’re at school.

Direct Unsubsidized loans or Unsubsidized Stafford loans-

These loans are available to all eligible students (both graduates or Undergraduates Students) and are not based on financial need. You are responsible for all interest payments (or capitalization of interest) from the date the loan is disbursed.

Perkins loans –

These Type of Federal Student Loans are subsidized loans which are reserved for undergraduate and graduate borrowers with extreme financial need.

Unlike all other federal student loans, which have interest rates set by Congress each year, Perkins loans always charge 5% interest and don’t have any fees.

Grad PLUS loans –

These loans are available for graduate and professional students and don’t have borrowing limits. Unlike Stafford and Perkins loans, which don’t consider borrower credit, you need decent credit to qualify for a Grad PLUS loan.

The government wants to make sure your credit report is free of negative marks like bankruptcies, charge-offs or past-due debt, says Karen McCarthy, director of policy analysis at the National Association of Student Financial Aid Administrators.

Parent PLUS loans-

These loans are available for parents with dependent undergraduate students. Parents’ credit histories must be tarnish-free to qualify. They can borrow as much as they need to cover their student’s college costs.

Federal Student Loans Borrowing Limits-

Year in school Annual borrowing limit, subsidized loans for dependent students Annual borrowing limit, unsubsidized loan for dependent students
First-year undergraduate students $3,500 $5,500 total (including subsidized)
Second-year undergraduate students $4,500 $6,500 total (including subsidized)
Third- and fourth-year undergraduate students $5,500 $7,500 total (including subsidized)
Aggregate loan limits $23,000 $31,000 (including subsidized)
Year in school Annual borrowing limit, subsidized loans for independent students Annual borrowing limit, unsubsidized loan for independent students
First-year undergraduate students $3,500 $9,500 (including subsidized)
Second-year undergraduate students $4,500 $10,500 (including subsidized)
Third- and fourth-year students $5,500 $12,500 (including subsidized)
Aggregate loan limits $23,000 $57,500 (including subsidized)

How to Apply for Federal Student Loan Program-

Applying for federal student loans can seem like a daunting process, but it’s actually quite simple and can be done mostly online. To make it easier, we’ve outlined the step-by-step application process below:

  • Start by completing a FAFSA Form (or Renewal FAFSA for returning students). This form is required for both current and prospective US college students (both undergraduate and graduate) to determine their eligibility for financial aid. It can be completed online and submitted directly to the Department of Education for review.
  • The student will begin receiving financial aid award letters anywhere from 3 days to 6 weeks after submitting their FAFSA. Each letter will outline all of the relevant information regarding the financial aid package being offered.
  • Upon receiving these letters, the student will contact their chosen school’s financial aid office to accept the student loan package being offered.
  • Once the student loan package is accepted, the student will simply review and sign any necessary paperwork associated with the loans, such as a Master Promissory Note.

Federal Student Loans Vs Private Student Loans-

You have the option first to grab the Federal Student Loans, but Private Student Loans can be also a good option for some borrowers. Such as Student who has borrowed the maximum amount of Federal Student and Still looking for Student Loans.

Interest Rates:

Federal student loans have the benefit of a fixed interest rate and usually, have lower rates than private student loans. Private student loans can be either fixed or variable rate.

Variable rate loans are often tied directly to the Prime or LIBOR rate and adjust accordingly. The interest rates for private student loans can vary widely depending on the lender, term length, whether the loan is fixed or variable rate, and the credit history and debt-to-income ratio of the borrower or cosigner. Current rates can vary from 2.5% up to 18%!

Federal Student Loans & Privates Student Loans Benefits

Applying for Private Student Loans:

Unlike most of Federal Student Loans, Private Student Loans require the full underwriting process. Lenders look for borrowers who have good credit and enough extra cash to make loan payments given other expenses.

that is a relatively low debt-to-income ratio. If you don’t meet those requirements, you may need a co-signer to qualify for a private student loan.

Banks, credit unions and a new crop of online lenders all offer private student loans. The biggest private student lenders are Citizens Bank, Discover, Navient, PNC Bank, Sallie Mae, and Wells Fargo Student Loans, according to the latest report. Startups including SoFi, CommonBond and College Ave also offer private student loans.

Federal Student Loan Servicers –

Great Lakes Student Loans: a non-profit company is dedicated to helping college students by working with both the US Department of Education and private lenders to make every step in the borrowing and repayment process easier. for more Info about Great lakes Student Loans Click here

Nelnet: One of the select group of companies chosen to service student and parent federal loans by the US Department of Education.

Their loan servicing department helps customers through both financial literacy tools and broad-based servicing. for more Info about Nelnet Student Loans Click here

FedLoan Servicing (also known as PHEAA): This company was established to directly support the US Department of Education in the servicing of federal student loans. 

Navient: One of the select group of companies chosen to service student and parent federal loans by the US Department of Education. Their loan servicing department helps customers through both financial literacy tools and broad-based servicing.

error: Content is protected !!