More than 18 million students are enrolled in colleges all across the United States and nearly all of these collegians require a loan in order to pay for their higher education. As a matter of fact, most students will require a combination of federal grants, state grants, federal loans, private loans and/or scholarships to fully fund their education. The average four year degree now costs more than $100,000 and this figure does not even include such required expenses as books, fees, and extracurricular activities. Here is a breakdown of the top lenders who are in the business of providing loans to college students:
Federal Government: Stafford
The federal government actually has a variety of student loan programs available. One of these is the Stafford, which has both subsidized and unsubsidized student loans. This loan is available to undergraduate students as well as graduate level students and the loan is guaranteed at one low interest rate for the totality of the loan term period. Payments on this loan may be deferred for up to six months after the date of graduation.
Federal Government: Perkins
This federal loan program is for very low income students and may also be used for undergraduate or graduate level studies. This loan has an exceedingly low interest and applicants may even request a cancellation of the loan if they opt to work as a teacher in a low income school district.
Federal Government: PLUS
This loan, the Parent Loan for Undergraduate Students or PLUS, is designed for parents of college students. This loan is provided to parents of college students and has a reasonably low interest rate. Qualified applicants must be the parent, guardian or step-parent of the student. The parent must have a good credit history and the student must be enrolled at least half-time in college.
Federal Government: Consolidation Loans
The federal government also offers a consolidation loan option, wherein the Stafford, Perkins and PLUS loans may be merged into one debt. Once the loans are aligned, the term of the one lump sum loan is longer and thus easier to pay off. Also, the monthly payments are smaller than with the several individual loans.
Private: Sallie Mae
Sallie Mae was first established in 1972 as a government back entity, but became privatized in 1997. Based in Newark, Delaware, Sallie Mae is a conglomerate of various lenders including CitiGroup.
Private: Wells Fargo
This student loan company is one of the most active when it comes to marketing and recruiting applicants to utilize their services. Wells Fargo allows their borrowers up to six months after graduation to begin making payments on their loan. This company offers loans for undergraduate and graduate students, and these loans are available to students as well as their parents.
Private: JP Morgan Chase
This lender is one of the leading financial institutions in the United States. JP Morgan Chase offers one of the more robust panels of options when it comes to loans, including various terms for each loan. This lender also offers consolidation loans.