Student Loan Rates

woman considering loan ratesStudent loans come in all shapes and sizes, and when you’re looking for a loan to cover college costs, it’s important to compare your options and evaluate a variety of different factors. One of the most important figures you should examine when considering a loan is its interest rate. This number more or less dictates how much you’ll have to repay when you are out of school and your loan comes due.

Types of Student Loans with Low Interest Rates

Just as there are different student loans, there are a variety of student loan rates available to borrowers. Generally speaking, federal student loans have the most favorable interest rates for borrowers: subsidized Direct Loans currently have a fixed interest rate of 3.76% for undergraduates, and unsubsidized Direct loans have an interest of 3.76% as well for undergrads, with 5.31% for graduate students. These federal loans have total borrowing limits, though, and sometimes students use all the federal funds that are available to them and still need additional funding. That’s the time to turn to private loans.

When it comes to private loans, the issue of student loan rates gets a bit trickier. Some private loans have fixed interest rates, but some have variable rates, which fluctuate based on current market conditions and lending patterns. These variable rate loans can wind up costing borrowers thousands of dollars if interest rates are suddenly impacted by a major shift in the economy, and so they’re a somewhat risky source of funding. It’s best to look for a competitive private loan with a fixed interest rate.

Benefits of Student Loans with Low Interest Rates

The obvious benefit of a student loan with a low interest rate is that the total cost of the loan will be relatively lower, though in some cases you may also find that your payment amounts and length are that much shorter that it will help you financially after college.

Refinance your student loan

Finding the Best Student Loan Rates

In order to obtain student loans with the best rates, you must thoroughly research your options, which is where SimpleTuition can help.  You should compare various loans; check out their rates, repayment terms, and other details before making a decision – and you can do all of this on our site. Doing the proper research will help you find the loan best for you. Federal student loans, such as Direct loans, should be explored first, as they have a fixed rate of interest, and various private student loans with low interest rates are available, as well.

Need a private student loan? Compare your student loan options all in one place. SimpleTuition