WHAT IS A STUDENT LOAN? Student loans are loans that the Federal government will give you to pay for college. These loans have to be repaid over a certain amount of time at an interest rate that is determined by the government. The interest rate for a student loan is much lower than the interest rate you would find at a bank or other lending institution. These loans also have a longer term which means you will have more time to pay them off. Six months after you graduate, you will have to begin paying back these loans. If, for some reason, you cannot, you can defer your loan payments for up to a year. If you return to school at any time during your repayment period, you can also defer until you are finished. Student loans are based on several factors. Your family income, the amount of money you may have received from a college, and your tuition costs. There are also two types of student loans, subsidized and unsubsidized loans. You will be responsible for paying back each type of loan but you may not have to repay the interest on a subsidized student loan if you can demonstrate the need.
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