Many households are beginning to think about paying that first college tuition bill. They are beginning to see what resources are going to be available to make the payment. Many will be considering using federal student loans to fund at least part of their college expenses.
Here are the interest rates for federal student loans, taken after July 1st, 2017.
The interest rate for Perkins loan is fixed and is at 5%.
Direct Subsidized Loan for Undergraduates is at 4.45%.
Direct Unsubsidized Loan for Undergraduates is at 4.45%.
Direct Unsubsidized Loan for Graduates is at 6%.
Direct PLUS Loans are at 7%.
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Federal student loans are one resource for funding upcoming college expenses. They are a means to making a college education affordable. This education hopefully is part of a pathway towards career success and happiness.
Federal student loans also need to be paid back.
Unfortunately, many students and parents do not realize how difficult this can be if your student is employed with a relative low income after college.
We are not here to discourage or advocate for student loan funding of your student’s college education. There are pros and cons that need to be taken into consideration before one signs off on the loans. Above all, a grounded and fact-based discussion with your student needs to be had before making the commitment to a student loan. And perhaps there are better alternatives to this particular financial resource.
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For years we have been helping families tackle their unique college preparation challenges. We can help reduce your stress and make better quality decisions – and save you a lot of money!