| Student Loan Information | Refinancing / Consolidation |
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Education loans are a form of financial aid that must be repaid, with interest. (Scholarships, on the other hand, do not have to be repaid.) There are 3 main categories of education loans : parent loans, student loans and private student loans (there are also called alternative student loans). Education loans come in three major categories: student loans, parent loans and private student loans (also called alternative student loans). Then of course there is another alternative - the consolidation loan / student loan refinancing. This allows you to lump all of your loans into one loan for simplified payment. Federal law sets the maximum interest rates and fees that lenders may charge for federally-guaranteed loans. Nothing prevents a lender from charging lower fees. Many lenders offer a variety of student loan discounts to attract borrowers. Few students can afford to pay for college without some form of education financing. Two-thirds (65.6%) of undergraduate students graduate with some debt, and the average federal student loan debt among graduating seniors is $19,202, according to the 2003-2004 National Postsecondary Student Aid Study (NPSAS). (The median is $17,120. One quarter of undergraduate students borrow $24,936 or more, and one tenth borrow $35,193 or more.) These figures increase by about 3% or approximately $550 a year. When one includes PLUS loans in the total, the average cumulative debt incurred is $21,814. (Approximately one in ten (10.7%) parents borrow PLUS loans for their children's college education, with a cumulative PLUS loan debt of $16,218.) Graduate and professional students borrow even more, with the additional debt for a graduate degree ranging from $27,000 to $114,000. The following table shows the percentage borrowing and average amount of cumulative debt among graduating students according to degree program. It provides the amounts borrowed for just the graduate education and also the combined totals for undergraduate and graduate education. |
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