A student loan is an effective way to cover some expense of attending college. Loans are not free money given to you, though. You will need to repay it. For some great advice on how to do this in the right way, continue reading this article.

Pay off all your student loans using two steps. Always pay the minimum balance due. Second, make extra payments on the loan whose interest rate is highest, not the loan that has the largest balance. This helps lower the amount of costs over the course of the loan.

Focus initially on the high interest loans. If you think you will be better off paying the one with the highest monthly payments first, you may be wrong. Best to look at the interest rates.

Grace Period

How long is your grace period between graduation and having to start paying back your loan? For Stafford loans, you should have six months. Perkins loans have a nine month grace period. There are other loans with different periods. Know when you are to begin paying on your loan.

When you pay off loans, pay them off from highest to lowest interest rates. Try to pay the highest interest loans to begin with. Do what you can to put extra money toward the loan so that you can get it paid off more quickly. Student loans are not penalized for early payoff.

Be sure to read and understand the terms of any student loans you are considering. It’s essential that you inquire about anything that you don’t understand. A lender may wind up with more money that necessary if there is a term that you don’t understand.

The best federal loans are the Stafford loan and the Perkins loan. They are the safest and least costly loans. These are good loans because the government pays the interest while you are still in school. The Perkins loan has an interest rate of five percent. Subsidized Stafford Loans will have an interest rate that goes no higher than 6.8 percent.

When applying for private loans without good credit, you will need a cosigner. Make your payments on time. If you don’t keep up with payments on time, your co-signer will be responsible, and that can be a big problem for you and them.

One type of student loan that is available to parents and graduate students is the PLUS loans. The interest rate won’t be any larger than 8.5%. Although this rate is higher than that of the Perkins and Stafford loans, it is lower than the rates charged for private loans. This means that this is a suitable choice for students who are a bit older and better established.

Utilizing the information you have just read should simplify the topic of student loans. It can be hard to find a great deal on a student loan. Spend the time necessary to learn all you can, and use the information above to get a great loan.

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