What are some subtleties of student loans?
Student loans come in a variety of “flavors,” which sometimes indicate different terms, repayment periods, delinquency issues, loan forgiveness clauses, and/or grace periods. As college approaches, all parents, guardians and prospective students should become familiar with these differences and evaluate the programs available. For example, there is often confusion between federal and private student loans. Many believe they are identical, work the same way, and are granted and paid in the same manner, yet in reality they often operate quite differently. Subsidized and unsubsidized Federal student loans, while accomplishing the same goals, are legally and operationally different too. Federal vs. private student loans First, learn the rule-of-thumb: Federal student loans are usually your best choice. Private student loans are typically your worst choice. The primary reason: Interest rates . Federal loan interest rates are usually lower than private, or “alternative” student loan rates. F
