- Direct Unsubsidized Loans are available to undergraduate and graduate students, and there is no requirement for demonstrating financial hardship. Interest is the responsibility of the borrower at all times; any unpaid interest will be capitalized.
Qualifying for Direct Loans does not require a formal credit check, so this is your best avenue for borrowing if your credit is bad or non-existent. Interest rates are low, currently 3.4% for subsidized and 6.8% for unsubsidized loans, and rates are fixed-so there won’t be any surprises during repayment.
Applicants for federal aid do so as dependant’ or independent’ students, which is determined by whether or not parental information is included on the FAFSA. Independent students enjoy higher borrowing limits. As of Direct Loan maximum borrowing limits range from $5,500 to $12,500 annually, depending on your individual situation.
Perkins Loans-Credit-free Campus Based Aid
Perkins Loans are federally funded student loans, which are administered directly by the Institution of Higher Learning you are attending. Perkins funds are reserved for undergraduate and graduate students exhibiting the greatest need for financial assistance during college. Typically, families with annual incomes below $25,000 are eligible for relief under the Perkins Loan program.
Not all schools participate in this lending program, so it is important to consult with your financial aid office for availability.
Because Perkins Loan funding is limited, and money is issued on a first-come first-served basis, it is imperative that you file your FAFSA as early as possible if you are counting on this type of aid. Three important factors influence the amount of your Perkins award:
- When you apply
- Your demonstrated need level
- The amount of funding available at your school
Maximum annual borrowing limits for undergraduates currently stands at $5,500, with a lifetime limit of $27,000. Graduate students may each borrow up to $8,000 yearly, and up to $60,000 over the course of their education. The fixed interest rate for Perkins Loans is currently 5%.
State Student Loans Offer Another Strategy
State loans for higher education are not available everywhere, but provide valuable resources for students attending college in states that do sponsor student lending.
The Minnesota Office of Higher Education administers SELF Loans, which are long-term fixed-rate education loans. The loans serve Minnesota residents pursuing higher education within the state or at out of state schools, as well as non-residents attending college in Minnesota. A credit-worthy cosigner is required under this program, which offers up to $10,000 annually.
Another state loan that requires a cosigner is the Dakota Education Alternative Loan (DEAL). If you are studying in North Dakota, South Dakota, Minnesota, Wyoming, Montana or Wisconsin, and all your federal funding options are exhausted guaranteedinstallmentloans.com/payday-loans-md, this loan program allows you to borrow up to $50,000 for school expenses.
Alaska Commission on Post Secondary Education runs a similar program for state students. To borrow from the AlaskAdvantage program, you’ll need a cosigner and a FAFSA on file. Eligible borrowers enjoy fixed interest rates around 7%.
Federal Pell Grants assist millions of financially needy students. You must qualify to benefit, but the money need not be repaid. Countless other private sources issue grants and scholarships. Grant and scholarship programs require no credit checks.
In addition to filing your FAFSA for federal help, check with your state government’s education fund. There are often state-based grants and state-specific scholarships for which you may be eligible.
Scholarships and Loans for Special Fields of Study
If you are pursuing a specialized degree in a high-demand field, such as education or health sciences, you might qualify for aid that specifically targets your profession. Many organizations and professional societies offer grants and scholarships for students who pursue certain careers.