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What to Consider When Selecting a Lender.
In almost all cases, students and parents should borrow the maximum
amount possible from Federal government loans (Perkins,
Stafford, and PLUS loans) before borrowing from private lenders. Federal
education loans are less expensive, offer better forgiveness and repayment
options.
If a Private Education / Alternative Loan is needed, ask your college
if they have a “preferred lender list.” Using a lender
from the preferred lender list will make processing your loan easier. However,
you have the right to choose other lenders not on your college’s
list. A comparison of the Private Education / Alternative Education
Loans is provided by a Loan
Summary Table.
It is recommended to research loan benefits and incentives before
selecting a lender. Go to each lender’s website and determine
the cost of fees, repayment options, and other incentives. These
include:
- The fees for loan origination and loan guarantee.
- Possible interest rate discounts.
- Loan consolidation options and the ability to fix interest
rates during repayment.
- Reducing interest rates for timely repayment and for automatic
payments/withdrawals from your bank account.
- Lender’s reputation for customer service.
- Other factors.
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