Worrying about student loans? You’re not alone. Millions of students across the country need extra financial help to pay for the cost of education. The current average student loan debt is almost $33,000, and most experts don’t expect this number to drop soon.
Don’t worry, there is some good news. Finding the best student loan to fit your needs is actually very easy thanks to modern technology. Let’s find out why.
Before shopping around, max out your federal sources first. For undergraduates, federal loan interest rates come in as low as 4.45%. Still, for dependent undergraduates you can only borrow a maximum of $31,000 of low interest federal loans. Depending on where you go to school, this might not be enough.
Federal Direct PLUS loans have higher borrowing limits, but PLUS loans also have higher interest rates of up to 7%. In this case, it might be better to look for a private lender.
Old Fashioned Way
To understand the new way of getting the best private student loan rates it helps to look back. In the past, student loan shopping was slow and painful. You had to go from lender to lender and fill out a form at each office. Then you had to wait days to weeks until you started to get replies.
For the large majority of borrowers, it takes more than one try to get approved for a student loan. Getting rejected is never fun. This scenario led many people to sign with the first lender that approved their application. In some cases, this meant paying more interest than needed.
Today, things are much easier. For starters, the web based multi-lender marketplace puts the entire process online. This means you’re in contact with many lenders on the same platform. Also, you only have to fill out one online form that asks you a few simple questions about yourself.
Next, you get a reply within minutes about prequalified rates from multiple lenders. No more waiting for days. No more getting rejected over and over again. Of course, there’s a small chance that no company will lend to you, but that would be the same with the old and new system. Still, in a large number of cases, you’ll have more than one lender to choose from.
If you are shopping for a student loan, use an online multi-lender platform. The benefits include:
- Only fill out one form online.
- Get real prequalified rates – not rate estimates, teasers, or ranges.
- Get put in contact with the lender of your choice.
- Finance almost any degree.
- Choose your flexible repayment plan.