When talking about student loans, you need to realize that there are two kinds: Private and federal loans. Now, student loans are incredibly dangerous loans. They have high interest rates because they are a non-collateralized loan. This means that if you don’t pay it off on time, the bank can’t take away anything from you as compensation.
Depending on the education level that you’re striving for, you can take out and borrow a certain amount of money each year.
Now, one big difference that I want to mention between the private and federal lenders is that the private lenders have their own necks on the line. That means that they’re going to look at your credit rating, and evaluate how likely you are to repay your loan.
The fed doesn’t do that though, and so it is better for you to apply to the fed for aid, because you have a higher chance of getting the amount of money that you need.
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