A student loan is a student loan, right? Not really. There are a variety of loans that may be called student loans. The best ones offer subsidized interest payments and features to help you out when times are tough -- and they're usually offered through government programs. However, banks have their own student loans. They may be competitive, but they're usually not your first choice.
The New York Times has a story on how the student loan industry can create problems for borrowers. The story tells us:
"In fact, one in five student borrowers passes up a less expensive federal student loan, and half do not even bother to file the paperwork necessary to qualify for federal, state and institutional aid, according to a recent study by the American Council on Education, a lobbying group for colleges."
This is why you have to do your homework on student loans. To learn the basics, see Student Loans 101.
Further reading:
- New York Times: Reeling in the College Bound
- How Subsidized Loans Work
- How Deferments Work
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