About Fannie Mae
Fannie Mae is a financial institution that has been offering various credit facilities to its clients for more than 70 years. It is a government-sponsored organization chartered by Congress to keep home ownership within reach, provide stability to the U.S. housing and mortgage market and to provide funds to mortgage lenders. Although Fannie Mae does not offer any home loans, it supports mortgage lenders, credit unions, national and local banks, and other financial institutions.
Does Fannie Mae Offer Student Loans? If not, what are the other options?
Fannie Mae offers many financial services; however, student loans is not one of them. However, other financial institutions do and there are plenty of private lenders that offer various lending solutions for students who are looking for funds to pay off college expenses. Students who have a good credit history and a cosigner can easily obtain these loans. There are various repayment packages and borrowers can choose the one that suits them best.
Before applying for private loans, students should always try to obtain federal loans, especially because federal loans have a lower rate of interest compared to private loans. Another advantage of these loans is that they are granted on the basis of financial need, while private loans take other factors into account, like credit worthiness. To apply for federal loans, students need to fill out the Free Application for Federal Student Aid (FAFSA) and submit it alongside the relevant paper work before the deadline.
Apart from loans, there are other available financial aid options, including scholarships, grants and work-study programs offered by institutional, federal and state resources. Scholarships and grants are awarded based on criteria such as financial need, academic merit and extracurricular activities. Notably, work-study arrangements help students find employment so that they may partially pay for tuition and other expenses. Most likely, a student’s financial aid package is composed of variety of scholarships, grants and loans.
While searching for Fannie Mae school loans, I came across cosigners. What role do they play in a student loan application?
Cosigners would be mentioned when searching for Fannie Mae school loans. Private lenders such as Fannie Mae require students to include a credit worthy cosigner when applying for a loan. The inclusion of a cosigner not only helps with the loan application, it also provides the lender with extra security. Even though the student is responsible for making the payments, the cosigner acts as security in case the borrower defaults. Students are recommended to exhaust their federal options first before applying for private loans.
Federal financial aid was mentioned when searching for Fannie Mae school grants. What options are the federal financial aid options?
The federal financial aid program offers students a number of options to help pay for school. The options available include loans, grants, and a work-study program. Grants available with federal aid are the Pell Grant and the Supplemental Educational Opportunity Grant. Loan options available include Stafford and Perkins loans. Students can also apply for the federal work-study program. In order to apply for these options, students need to fill out the FAFSA (Free Application for Federal Student Aid) and submit it before the deadline date. You can do so online at www.fafsa.ed.gov.
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