Need help. National City bank question regarding student loans.?
So i’m a freshman in college and my parents were able to pay off my first semester of college tuition (about 7500$ – God Bless Them) but now i must go on the hunt for student loans. Has anybody ever used National City because they are my debit/credit card bank. I need a Federal Unsubsidized loan through them or their own version of a student loan. Any information would be a plus.
The answer to your question depends on what you’re actually looking for – you’re confusing two things in your question.
First of all, let’s talk about the “federal unsubsidized” loan that you’re asking about.
The federal unsubsidized loan is a Stafford Loan. In order to qualify for a Stafford loan, you must submit a Free Application for Federal Student Aid (better known as the FAFSA), using the US Department of Education website at http://www.fafsa.ed.gov/ . You can only apply for a Stafford loan when your school’s financial aid office has offered you a Stafford loan. That can’t happen until you have completed a FAFSA, and until your school receives an Expected Family Contribution score from the Department of Education.
This is what you want to have happen, because the Stafford loan is far better and cheaper than the other type of loan you’re asking about, which is something called a “private educational loan”. The Stafford Loan is a fixed rate, low interest loan, while the private educational loans are offered at higher, and variable interest rates. Staffords are not based on income or credit history, and never require a cosigner, but private educational loans are credit and income based, and very few students can qualify for one without a cosigner.
If you do qualify for a Stafford (and it’s about 99.9999% likely that you will), your school will require you to select a Stafford lender. Chances are that they will provide you with a list of banks that make Stafford loans. Lenders choose to participate in the Stafford lending program, but all participants must agree to make those loans the same way – with the same terms, the same qualifications, the same interest rates, etc. In that regard, there is not a tremendous amount of difference between one Stafford lender and the next.
(A few years ago, lenders competed for Stafford applicants by offering borrower “incentive programs”, but very few of those benefits remain. At most, you’ll probably find that your lender will offer you a small interest rate discount if you agree to allow the lender to sign you up for “autopay” of your student loan.)
If you wind up looking for private educational loans – then you will need to comparison shop carefully for your loan. The key to determining the expense of your loan will be the interest rate, and different lenders have different formulas that you use to calculate the variable interest rate that applies to those loans. You’ll also need to see if the interest is capitalized every month while you’re in school, or just one time when you repayment obligation becomes due. (the latter is preferable).
Good luck to you. I highly recommend that you spend a few minutes with the US Department of Education booklet that I’m linking to, below. This publication explains the entire aid system, including Stafford loans, private loans, and all of the other forms of educational assistance that are available. I hope this helps!
