So I received some paperwork from Direct Loans/ William D. Ford Federal Direct Loan Program. This is my first experience securing a student loan, and I was wondering what experiences I can draw from from those on this forum. After reading the material, it appears I was approved for an interest rate at 6.80%. What do you folks think?
Well, that's a pretty broad question. As StefanM states, the interest rates are standard. And as far as "approved" goes, well, all you have to do to be approved is show need. They are not credit based, and are not based on prior student loan payment history (outside of default status). I can tell you to stay with subsidized over unsubsidized, if you have an option. If you're in my shoes, you're having to take both. When it comes time to repay, just know this: they don't play. Stay on schedule, and stay in contact, and you'll be fine. There is a new member on here that works for a student loan servicer, and appears extremely knowledgeable. Perhaps they can pipe up on here.
Yes, a subsidized loan is the best way to go because, as long as you are in school, you don't accrue any interest. Therefore, if you can manage to pay it off while you are still taking classes, you will essentially get the loan interest free.
OOOkay, this is so my wheelhouse. Are your loans subsidized or unsubsidized? MichaelOliver was right but incomplete - unsubsidized loans, which you often get along with subsidized as the cap on subs is nowhere near enough for costs, DO accrue interest while on in-school deferment. Directs update to inschool status automatically, which I freaking love. But if you spend more than six months out of at least half-time status, then you've used your grace period. (advice good only for Staffords and Unstaffords, not anything PLUS) 6.8 is the standard direct interest rate for an unsubsized loan - subs are six percent if memory serves. you can lower it .25 percent once you get into repayment (finish classes) by signing up for autopayment out of your checking account. Sorry I took so long to get to this one.
Like the other readers have mentioned, the interest rates are standard ones for Direct loans. You have to be prompt when it comes to repayment. However, there is one workaround for this. You can try signing up for student loan forgiveness for teachers, that is, of course, if you are willing to continue as a teacher.
