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Financing Tips for Graduate Students

There comes a time for every student to think about what awaits them after graduation. Perhaps you want to become a teacher, doctor or engineer in the future. Or maybe you have not yet decided whom you want to be and what area you see yourself in. However, almost any field will require you to earn a higher education in order to become a highly qualified specialist and succeed.

Regardless of the path you choose, sooner or later, you will have the question, “How do I pay for my college education?” And “student loan” can be an answer. As we want to support our students and guide them towards academic mastery, we want to help them understand what student loans are and how they work in real life.

Students of Hondo Valley Public Schools can access two types of student debt: federal and private student loans. Let’s realize what type of borrowing will work better for a particular child.

Federal Student Loans

A federal student loan is a government-backed type of debt that undergraduate, graduate, and professional students, as well as their parents, can get on favorable terms. The cost of a federal loan is commonly lower than that of a private one. The government allows a student to split their loan into ten years and make payments after they finish college. There are three common types of federal student loans with several repayment plans to consider:

  • Subsidized student loans, which are available for undergraduate students who have financial needs. Thus, you or your family need to meet the maximum income requirements to qualify. Also, you can’t get a sum that exceeds your limit. The limit will be determined by the school. Subsidized loans come with a payment deferment, so the government will cover loan interest until you graduate and up to six months after it.
  • Unsubsidized student loans, which don’t require a student to demonstrate financial need. These loans offer higher limits but also have higher interest rates. Moreover, unsubsidized debt doesn’t offer any postponement. You will be obliged to start paying it off right after you get it.
  • PLUS loans. These loans are offered to graduate and professional students and their parents. They allow them to cover any costs associated with your education and are not covered by any other types of aid you’ve got. PLUS loans always require an applicant to pass a credit check, so you or your guarantor must have a satisfactory credit score to qualify.

Private Student Loans

Private student loans are borrowing options offered by banks, credit unions, and private lending companies. They have a number of positive and negative options. Private student loans come with an installment structure and variable interest rates, which means they can fluctuate over time). Also, private loans typically have a higher cost and require a student to start repaying it right after getting it without any payment deferment.

Private student loans require a student or their co-signer to go through a check of their financial condition. Thus, you need to have good credit and sufficient income to get one. A private lender will be more attentive to your financial situation and credit issues than the government. Thus, you may be either rejected for a loan or get the money on worse terms if you have no or bad credit.


If you don’t want to obtain debt or are not sure you will be able to repay it, there’s one more option to consider. Talented students who demonstrate high academic performance can apply for scholarships and grants that are gratuitous. Almost every field you might be interested in has fellowships, grants, and financial aid programs. Numerous organizations are currently prepared to assist students. Take the time to look around and don’t be afraid to apply for non-refundable financial aid. It will help you avoid debts and save money.