Student loans have been an item of concern lately, not only due to the amazing pace of growth in debt amounts but also in interest rates assessed to them. There are some options beyond private loans or subsidized loans, such as community-based school loans, which are gaining traction.
Organizations all over
Though Daily Finance made it apparent that there are a lot of community associations showing up to help students, MarketWatch had the majority of the info about them. These organizations are community-based and offer school loans to students in the area that need a bit of help.
It is just like the recent "crowd sourcing" that has been going on. The funds are all put into one big pot and loans are made from it.
The Canton Student Loan Organization of Canton, Ohio has lent $27 million to over 5,000 students since 1922 when it was first started, meaning the idea is not a brand new one.
However, just like crowd funded personal loans sites such as Lending Club or Prosper, those loans do have to be paid back with interest.
Between private and public
Daily Finance, Bankrate and MarketWatch all made it clear that community-based student loans, on the subject of cost, are someplace between federal school loans and private school loans.
The Consumer Financial Protection Bureau got 46 percent of its student loan complaints from Sallie Mae, which is pretty e costly for private loans. You may also get private loans from a credit union or community bank, though they are usually cheaper.
Depending on the community-based student loan organization, interest can be anywhere from nothing to eight percent, according to MarketWatch. The catch is that the loans usually require a massive piece of collateral, such as a parent's home, and have much harsher terms. Federal Stafford loans have the very best rates and Private loan rates could be as high as 16 percent.
May not cover university
According to Bankrate, community-based student loans may not be enough to cover the total cost of university, but just enough to cover tuition and books. Many of these organizations just do not have the money to lend the federal government or big banks do.
A "personal loan for educational purposes" might be provided by credit unions in the same way, and the terms would be better than if you were to go to a private lender. Students and parents have to do the work to figure out which program will work best for them. According to CBS, there are loan consolidation programs at credit unions that may be worth checking out.
Organizations all over
Though Daily Finance made it apparent that there are a lot of community associations showing up to help students, MarketWatch had the majority of the info about them. These organizations are community-based and offer school loans to students in the area that need a bit of help.
It is just like the recent "crowd sourcing" that has been going on. The funds are all put into one big pot and loans are made from it.
The Canton Student Loan Organization of Canton, Ohio has lent $27 million to over 5,000 students since 1922 when it was first started, meaning the idea is not a brand new one.
However, just like crowd funded personal loans sites such as Lending Club or Prosper, those loans do have to be paid back with interest.
Between private and public
Daily Finance, Bankrate and MarketWatch all made it clear that community-based student loans, on the subject of cost, are someplace between federal school loans and private school loans.
The Consumer Financial Protection Bureau got 46 percent of its student loan complaints from Sallie Mae, which is pretty e costly for private loans. You may also get private loans from a credit union or community bank, though they are usually cheaper.
Depending on the community-based student loan organization, interest can be anywhere from nothing to eight percent, according to MarketWatch. The catch is that the loans usually require a massive piece of collateral, such as a parent's home, and have much harsher terms. Federal Stafford loans have the very best rates and Private loan rates could be as high as 16 percent.
May not cover university
According to Bankrate, community-based student loans may not be enough to cover the total cost of university, but just enough to cover tuition and books. Many of these organizations just do not have the money to lend the federal government or big banks do.
A "personal loan for educational purposes" might be provided by credit unions in the same way, and the terms would be better than if you were to go to a private lender. Students and parents have to do the work to figure out which program will work best for them. According to CBS, there are loan consolidation programs at credit unions that may be worth checking out.
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