A lot of young adults are beginning college this time of year and if you are still worried about making tuition payments we have some help for you. Todd from Cambridge Credit in Agawam joined us to talk about both federal and private loans how balancing the two maybe the answer.
Todd said that federal loans have a low interest rate which is set by Congress. They also have flexible payment options, which make them very appealing. In order to apply for a federal loan, Todd said you have to fill out a FAFSA, or Free Application For Student Aid.
Todd noted private loans can cover what a federal loan does not, but you are likely going to need a co-signer for those loans because a young person typically does not have the collateral needed to take out a loan. Also private loans have less flexibility for repayment options.
One of the best ways to pay for college, according to Todd, is a combination – both federal and private loans, as well as scholarships, grants, and work study programs.