Need-based Student Loan Posted on 2010-05-26 |

A need-based student loan is ideally suited for students whose financial condition is not good but they want to finish their education. Before availing a need-based student loan, make sure the repayment schedule is set on the basis of your financial condition. When this is the case, you will be able to repay the loan amount without any hassle. Read the terms and conditions of the loan carefully before signing the agreement paper.

Features of Need-based Student Loans

• Offered by the federal government, the rate of interest of need based student loans are normally quite low. The most famous need based student loan is the Stafford loan, which you can avail at a fixed interest rate.
• You do not need to repay the principal loan until you graduation. This process is commonly known as a deferred payment loan.
• You get a grace period of six months following graduation with these loans. During this period, there is no pressure on you to pay anything.
• In comparison to other loan packages, you will find the approval procedure for need based student loans is relatively straightforward. You just need to fill out the loan application form correctly and the loan will be accredited to your student account with your school in a matter of days.

Kinds of Need-based Student Loans

There are four kinds of need based student loans available: Perkins, Subsidized Stafford Loans, Unsubsidized Stafford Loans and Plus loans. The main advantage of these loans is that you do not need to pay anything while you are studying.

To avail Perkins loans, you need to contact the financial aid office for application payment details. If you are interested in getting Subsidized Stafford loan, you will need to pay a fixed interest rate. Similar to the Perkins loan, you do not need to pay any money while you are in school. No credit check will be implemented when you apply for a Subsidized Stafford loan. Unsubsidized Stafford loans are different in the sense that you need to pay monthly installments on the interest even if you have not graduated