The Convenience of a Graduate Student Loan

Students look at a graduate student loan as an alternative to student debt, its obvious attraction being the ability to get one without collateral or the need to show proof of a regular income. Normally, students are in college fulltime and neither have jobs or properties of their own.

Being an unsecured loan, a graduate student loan normally has a reasonably good interest rate. It usually doesn’t take long for such a loan to get approved, but this speed and convenience comes at a price. Borrowers could find themselves tied up in a long-standing bond that is not exactly to the advantage of the borrower.

More costly than a student loan, a graduate loan is typically given upon graduation, when a student just out of college is not qualified for a student loan anymore. This loan is intended to ease the transition from college life to an employed life. Someone who has just joined the workforce would need a place to stay, new clothes appropriate for the workplace, and other necessary expenses.

A student overdraft, a regular feature in a student’s bank account, can be paid using a graduate loan. But one has to be reminded that a graduate student loan, even though inexpensive compared to a personal loan, is more costly than a student loan.

But once a fresh graduate has found a job, he or she could get a loan from the employer or company that has hired him or her at better rates. This is an alternative to a graduate loan open to new graduates, who could also avail of what is called a career development loan, meant for those who enroll for another course like medicine or graduate studies.

Student debts are continually increasing, with graduates who have found employment doing better than undergraduates since the former do not rely too much on loans but on their salaries for their daily needs and other necessities.

Someone who finishes college and decides to pursue graduate studies will broaden his or her horizons in other academic fields which could lead to better career opportunities. If it is necessary to do this by taking out a graduate student loan, it could also mean a new set of financial burdens. But it is an alternative that many graduate students are more than willing to take to pursue higher education.

If you want to apply for this loan, the first thing to do is fill out a Free Application for Federal Student Aid (FAFSA) form. You will be asked questions about your salary and savings or that of your parents. You can do this online or obtain a hard copy. After you have mailed your FAFSA application, the government will look at it and inform you how much you need to contribute to your graduate studies. Include in your application the graduate schools you are thinking about to enroll in so the government agency in charge can also send them a report.

Send applications to federal agencies for both subsidized and unsubsidized loans. Federal loans have the least expensive interest rates. You are better off maximizing federal loans to avoid the more expensive interest rates of private creditors.

A Grad Plus Student Loan can help you with the balance for your tuition. This loan can only be acquired from private creditors. Find the best interest rates available by shopping around. Many graduate schools will provide you a list of creditors and the interest rates they’re offering. The amount you can borrow depends on your credit so you better apply as soon as possible for a graduate student loan, making sure that you only make a request for the exact amount you’ll be needing for your education to increase your chances of getting approved.