My daughter has been offered a Perkins and a Subsidized Stafford loan for college. Which is better and why?

Question

My daughter has been offered a Perkins and a Subsidized Stafford loan for college. Which is better and why?

Answer 1

The Perkins loan is always a better loan option.  It is a fixed 5% interest rate and has very generous forgiveness provisions for careers in high need areas, military service, teaching, nursing, etc.  It is a subsidized loan with a nine month grace period.  That means that no interest is accruing on the loan while the student is enrolled at least half-time and the student doesn't enter repayment until 9 months after that.

The subsidized stafford loan is also fixed but at 6.8% and has some forgiveness provisions for teaching.  It has a 6 month grace period which means that it does not accrue interest and the student does not enter repayment until 6 months after the student ceases to enroll at least half-time.

Information about both loans is available at www.fsa.ed.gov.

Answer 2

i had both...but now that my loans are coming due because i took the semester off im kind of regretting it. make sure you understand the loans and how much interest and such you are going to have to pay back once she's done with school. I'd say if you can and you know that in 4 years you can manage to keep up with payments, take both loans.

Answer 3

A Federal Perkins loan is a low interest (5%) loan for undergraduate and graduate students with “exceptional” financial need.

Stafford loans are the most common source of college loan funds. Subsidized Stafford loans are also for those deemed to have financial need. The interest rate for Stafford is currently 6.8%.

Best idea is to do some research on these loans and discuss them with the financial aid office of your daughter's school. More info on both types of loans at links below.

Answer 4

I took out the subsidized stafford loan. You don't have to pay any interest on it while you're a full time student. the government will pay it off until you graduate or start taking less than 12 hours a semester (12 is what it is in NC im not sure about anywhere else) You can pay it off before graduating if you have the money. If you wait til after you graduate the payments are small and have a low interest rate.