Normally, graduate students pay for tuition fee more than
undergraduate. Therefore, the main purpose of graduate loans is
to help fund their education. There are two venues in which
graduate students can obtain graduate loans: the government and
private entities, (who provide alternative graduate loans). Each
of these is discussed in more detail below.
1. Government Graduate Loans This type of loan is the same as
undergraduate loan. The only difference is name. Like
undergraduates, graduates have the opportunity to get a Stafford
or Perkins loan from the government.
Stafford graduate loans are available to any graduate student
regardless of their financial situation. Two types of Stafford
graduate loans exist: subsidized and unsubsidized. The
difference in the two lies in who pays the interest. For
subsidized Stafford graduate loans, the government pays the
interest. Students pay for the interest in unsubsidized Stafford
graduate loans, though there is the option of not having to make
payments until after graduation.
A Perkins graduate loan is available to students who demonstrate
financial hardship. It has an interest rate of only 5 percent
and can finance up to $4,000 of the graduate student's
education. For graduate students who are adversely limited
economically, the Perkins loan is not a bad option. However, one
must keep in mind that payments are still expected to be
received promptly and perpetually. In extreme circumstances it
is possible to request a deferment on loan payments until one is
able to pay normally.
To apply for either the Perkins or Stafford graduate loans, one
must submit a FAFSA form to the government. When the form has
been processed the government will send a SAR (Student Aide
Report) which will give further instructions on how to apply for
2. Alternate Graduate Loans This loan has also been known as
private graduate loans, are loans funded by non-governmental
entities. Companies offering these loans could be banks, credit
card agencies or any other enterprise interested in helping
graduate students secure student loans. The Education Resources
Institute (TERI) is an example of a company offering this type
of loan. It is called the Act Graduate Student loan program. The
application can be filled out online at http://gradloans.com. Decisions
are received in as little as 15 minutes.
You can first try to visit websites of all the major banks
because many do offer student loans services. Or you can use a
search engine by typing the name of banks you know. Some banks
will even offer graduate loan comparison charts to help their
customers see how their loans stack up against the competitors.
These charts can serve as a further aide in researching graduate
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