Lowest Interest Rate On Student Loans
If you’re reading this, it’s likely that you have a student loan debt and are looking for ways to lower your payments. If you want to pay off your loans faster with less interest and have access to good credit, then keep reading. I’ll explain how to find the best interest rates on student loans, as well as what factors can help you determine which loan is right for you.
Fixed-rate student loans
- Fixed-rate student loans are best for people who don’t want to worry about interest rates changing. The main reason you might choose a fixed-rate loan is because you want to pay off your loan as quickly as possible and don’t want the risk of variable rates going up in the future. If this sounds like you, then consider choosing a fixed-rate option with lower monthly payments so that you can save some money on interest over the life of your loan.*
- Fixed-rate student loans are also ideal for those who plan on sticking with their chosen career path after graduation. For example, if your degree requires state licensure or certification that requires continuing education every few years (or even annually), having a fixed rate will allow you to budget accordingly without worrying about how much more expensive it’ll be next year or in five years from now when it’s time for another round of training courses.*
Variable-rate student loans
- Variable-rate student loans: Variable-rate loans are more risky and can be more expensive than fixed rate loans. They’re not a good idea for most students, but students who are sure they will be able to pay off their student loans may want to consider them.
- Fixed-rate student loans: If you have good credit and can qualify for a low interest rate on a fixed-rate loan, it’s generally best to go with this type of loan because you know what your monthly payment will be each month until your balance is paid off.
Federal student loans
Federal student loans have fixed rates. This means that your interest rate will not change during the life of the loan — unlike a variable rate, which can go up or down depending on certain factors like market conditions or changes in the federal funds rate.
Federal student loans are also guaranteed by the government, so you don’t have to worry about your lender going out of business and leaving you without recourse if something goes wrong.
Student loans with lower interest rates typically have shorter repayment terms as well — making them an ideal choice for borrowers who want low monthly payments but aren’t able to pay off their debt quickly enough for a 0% intro APR offer.
Private student loans
Private student loans are not guaranteed by the government and can be more expensive than federal student loans. However, they also offer more flexibility to borrowers and often have more options, making them a better choice for some students.
Private lenders, such as banks and credit unions, are not required to keep your loan in good standing if you’re struggling to make payments. You may have heard of people who’ve had their vehicles repossessed because they couldn’t afford the monthly payments on their car loans — this is similar to what happens when private lenders pull the plug on your education financing: The lender can decide that you aren’t eligible for further funds from them anymore.
If you’re having trouble paying back a private student loan because of financial hardship or unemployment (or another reason), it might help if you talk with your lender about how they handle these situations. There are usually options available that can help borrowers meet their obligations while still protecting their credit rating and avoiding defaulting on their obligations altogether
The best way to get the lowest interest rate on your student loan is to apply for a fixed interest rate with a federal or private lender.
The best way to get the lowest interest rate on your student loan is to apply for a fixed-rate student loan with a federal or private lender. Variable-rate loans are not good because they can end up costing you more over time, so avoid them. Federal loans are good because they offer fixed rates and lower interest rates than many other lenders. Private loans, however, tend to have higher interest rates and fewer consumer protections than federal loans or other options discussed below.
We hope this article has been helpful to you. If you have any questions or concerns, please feel free to contact us at (888) 123-4567.