How To Choose a Stafford Loan Lender
Use these tips to land a suitable Stafford Loan Lender.
Stafford Loan Money Saving Tip #1
Find a lender who offers lower fees that will save you
money down the road after you graduate and start repaying your student loans.
Stafford Loan Money Saving Tip #2
Processing a student loan can take four to six weeks;
consequently, you should apply for a Stafford loan in the late spring or early summer before heading off to
Stafford Loan Money Saving Tip #3
Don’t waste your valuable time wading through scores of
lenders; when a school participates in the Federal Direct Student Loan Program, the school's financial aid office
will tell you how to apply and who the approved lenders are.
However, if you have an FFEL Stafford loan, you can choose your own lender.
Stafford Loan Money Saving Tip #4
When it comes to Stafford Loans, just about anywhere you
go, the interest rate and loan terms are going to be the same.
Although it is possible to find a lender offering slightly lower fees, the differences aren't anything to write
Having shared that tidbit, it doesn't pay to spend an enormous amount of time shopping for a lender; researching
a few lenders may save you some money down the road, but not much.
Stafford Loan Money Saving Tip #5
We all want to save money and cut costs right? If you want
to lower your Stafford Loan repayment costs, and you should, then look for a Stafford lender that sells its student
loans to The Student Loan Marketing Association, better known as Sallie Mae.
Sallie Mae is the largest purchaser of student loans on the secondary market (where banks sell their loans to
raise additional money to lend). They currently own about one third of all student loans. In order to make their
investment packages of student loans appealing to investors, Sallie Mae offers incentives for student borrowers to
repay on time.
To find a bank in your state that sells its loans to Sallie Mae, dial 800-891-4595 and request the free brochure
"Borrowing for College." Or you can visit Sallie Mae's official Web site.
Stafford Loan Money Saving Tip #6
Ask the experts! Your school financial aid counselor or
officer has probably helped hundreds if not thousands of students acquire Stafford Loans and other types of
financial aid. You should pick their brain to find the lenders who have a good reputation for processing loans
promptly and avoiding errors and delays.
Stafford Loan Money Saving Tip #7
Stay away from Stafford Loans that are capitalized more
than once. If you're taking out an unsubsidized Stafford loan on which you're deferring both interest and principal
payments, ask the loan officer how often the bank "capitalizes" the interest on the loan. (i.e., how often, or
how many times the interest you're deferring is added to the principal balance.)
If the lender capitalizes the interest, on a: monthly, quarterly or bi-annually basis, your amount owed begans
to increase and so will your payments. The best possible answer to that question is "once, when the loan goes into
Stafford Loan Money Saving Tip #8
When you find a good Stafford Loan Lender, you may want to
stay with them. Keeping your loans bundled with one lender makes repayment infinitely simpler.
Your eliminate the multiple loan payment quagmire and you won't have to notify multiple lenders each time he or
she moves, which recent graduates tend to do frequently.
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