Government Student Loans
The single most important source of College funding is Government Student Loans. Here are some of the most important things you need to know about them.
One of the major achievements of the Bush administration has been the programs to make Government Student Loans more accessible. Government Student Loans have become one of the major sources of College funding and have made higher education possible for millions of Americans who might otherwise have struggled with constantly rising College costs. There are a couple of very important facts that you should understand about Government Student Loans.
The first thing to remember is that the Government is not the lender. The Government actually acts as a co-signer for your student loan. The actual loan is made by a regular lending institution that distributes the funds and manages the account. They are the ones that set the loan terms subject to Government regulations and approve the loans. This is what makes the loans so accessible for many potential students. With the United States Government co-signing your loan, approval is usually fairly easy.
There are several types of Government Student Loans. They include Stafford Loans, Perkins Loans, PLUS loans for parents of Students, and Federal Student Consolidation loans. Each of these loan programs has different requirements, limits, and repayment conditions. The starting point for all Government Student Loans is the Free Application for Federal Student Aid (FAFSA).
Once this application has been filled out and submitted, the Government determines your eligibility for student aid. This is usually handled through the Student Aid Office of your selected College or University. In fact, the Student Aid Office is the major headquarters for handling the problems of paying for College and a visit to it is one of the first things you should do when visiting a potential school.
The Government acts as co-signer which means that if you do not repay the loan, the Federal Government will repay it for you. This sounds like a pretty good deal. It is obvious that the Federal Government has a lot more money than you do even after you graduate and get a good paying job. This is not a very good outlook, however. Once the Federal Government has assumed your loan, they will be the ones that come to collect it from you. They are very aggressive at this and very good at it. They can take your income tax refunds or even garnish your wages. Think of the Federal Government as your friend in the student loan process, but make sure you are a loyal friend to them as well.
