As the economy in America is still not good, most families are in tight financial corners to even meet the basic necessities. Payday loan lenders are aware of this situation and of the near impossibility for families to save for college tuitions. To pursue higher studies loans and grants have become a necessity for most people. Stafford loans rules have undergone a change but do not benefit the college student.
Government gives loans directly to students for higher studies with the condition that the student will repay the loan within six months on completion of graduation. These government loans are called Stafford loans. These loans maybe subsidized wherein the government pays interest on the loans till the student begins payback. If the loan is unsubsidized then the student is liable to pay the interest as well. Student loans borrowed before July 1st 2012 is subsidized but those borrowed after that, the student will have to pay the interest along with the principle amount.
Changes For Stafford Loans:
- The interest rate on subsidized loans has gone up from 3.4% to 6.8%
- Students who received the loan after July 1st 2012 till June 30th 2014 will have to pay interest for the six months period after their graduation when they begin to repay the loan
- The fee rebate of 0.5% is no longer effective
- Loans for graduates/professional school are unsubsidized and the student is liable to pay the interest
These changes have been brought into effect for Stafford loans only. The other loans options available are:
- For graduate and undergraduates- Perkins
- Undergraduate students parents can avail loans from- PLUS
- Graduates and professional school students avail loans from- GradPlus
Changes in the Stafford loans could create problems for parents or students. These changes affect the business of payday loan lenders hence they closely watch the changes on students’ loans. The students usually do not find high paying jobs after graduation so as to start paying off the borrowing within six months. Payday loan money lenders provide relief by offering fast cash in that situation. Graduates who have started working but are yet to get their first paycheck also use the services of these payday lenders.
Everyone does not have friends or family to help for tiding over the tight financial situation. With a new job, the need for a new apartment may arise. This is an additional expense. Most students look out for other options to borrow the money and get over the situation. Find an option that does not burden the pockets of you or your family and makes it possible to achieve your goal as well.