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Monday, January 5, 2009

Bad Credit Student Loans That Actually Exist

By Trinity Payne

If you're anything like most people, the cost of college is a little outside your price range. Paying $15,000+ each year as a 19-24 year old is definitely outside the reach for most people that don't have help from their parents. If you're struggling to meet financial obligations while attending college, having bad credit can magnify your difficulties. However, student loans for people that have bad credit are available and finding the right ones can help you to pay for school.

Student loans can be classified in two different categories; ones issued according to financial need, and ones that arent based on financial need. Many of the loan options are supported by the Federal Government.

The subsidized Federal Stafford Loan and Perkins Loan are two loans that use financial need as a qualifier. In the case of the subsidized Stafford Loan, the government pays the interest as long as you are in school and for the first six months after you leave school. The Perkins Loan is also issued based on financial need, although there are less of them given out compared with the subsidized Stafford Loan. However, if you can qualify for one, it is a really great thing as it will save you money in the long run.

If your financial need is big enough, you may even qualify for a Federal Pell Grant. Federal Pell Grants are the best option because it is considered a gift. You are not required to repay the money you receive. If you qualify for a Pell Grant, but it is not enough to pay for all your tuition and expenses, you can still look into receiving a loan to help meet your financial needs.

For people who cant qualify for one of the need based loans, there are still other bad credit student loans that are not based on financial need. The unsubsidized Stafford loan doesnt use financial income as a qualifier for the loan. With this type of loan, it will accrue interest once you receive the loan. The government doesnt pay any of the interest on the loan.

People that take out unsubsidized Stafford loans will have to start repaying them immediately. There is no grace period for these loans since they are offered to people that don't have financial need.

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