Federal Student Loans

There are many different types of federal student loans. The most common are:

1. Stafford Loans

If you are going to get a Stafford loan, you should know about the two types of those. The FFEL or Direct loan programs. Your school chooses which type of loan it awards. A FFEL loan is one in which your lender is private, like Sallie Mae or Bank One, but these loans are still federally insured.

With Direct Stafford Loans, your lender is the Department of Education. There is not much difference between these two types of federal loans for students.


2. Perkins Loans

The Perkins Loan is awarded to students with extreme financial need. The school is the lender and all Perkins Loans are subsidized, and the interest rate is fixed.

3. PLUS Loans

PLUS Loans are loans that your parents take out for your education if there is no other financial aid available. The maximum amount that your parents can get is equal to your cost of attendance minus any other aid you receive. The PLUS Loan goes into repayment 60 days after the student starts school. You can learn more about PLUS loans at PLUS-Loan.org

4. Consolidation Loans

Consolidation Loans are available for students with more than one loan who want to have one monthly payment. The downside is that once you consolidate, the interest rate is fixed and you can not re-consolidate the loan again.

5. Alternative/Private Loans

Taking out college loans is borrowing money, and it is very important the you realize this before signing for the loan. Please take a look at our Borrowers Rights and Responsibilities page.

Federal Student Loan Resources

FAQ About Federal Loans for Students

Many students have questions about whether their credit scores affect their ability to get federal loans. Your credit score is very important, but many teens don’t have much credit history. It’s easy to build your credit — and easy to destroy! Having several revolving accounts, paying your bills on time and not carrying too high of a balance on your credit cards can help you build a stellar credit score.

If I don’t have a credit history, can I still get a federal loan?

Yes, because federal loans do not require you to have a co-signer (typically a parent or guardian). The government does not check your credit score. You do have to be a permanent U.S. resident and have a Social Security number of your own. You cannot fill out a FAFSA without one. Private student loans may be an option if you are unable to get a federal loan.

Do I have to pay back the loan money? What if I don’t?

You must pay it back. Your loans show up on your credit report. If you fail to pay your loans, you cannot get another loan until you do pay it. Unpaid loans never disappear from your credit history, not even if you declare bankruptcy! It is very important to work out a payment plan if you are having trouble making your monthly payments.

What are the other requirements to get federal financial aid?

  1. Register with Selective Service if you are a male
  2. Get a high school diploma or GED
  3. Enroll in an accepted college or university
  4. Have no drug convictions during the time you receive your federal aid
  5. Owe no refunds or default money on another federal student loan
  6. Be able to show financial need