9 Benefits of Federal Student Loans for College Students

Paying for college doesn’t have to be stressful with Federal Student Loans.
Paying for college doesn’t have to be stressful with Federal Student Loans.

So, you finally decided to take control of your future by attending college. Now it’s time to investigate how Federal Student Loans can work for you.

You’ve determined what career path to follow, researched employment opportunities in your field of interest, and discussed the challenges and rewards of your decision with your family. Here comes the big question…how will you pay for college?

Kevin Walker, CEO of Simple recommends students with financial need exhaust their federal options before looking to private loans. They’re not as complicated as people assume and all types of incomes qualify for the loans. Once you fill out the FAFSA (Free Application for Student Aid) at IntelliTec’s financial aid office, a representative can help take you step-by-step through an evaluation of your payment options.

9 Benefits of Federal Student Loans

1. Flexible Repayment Plans – your payments will adjust to your income. When you first start working to build your career, your payments will reflect your “newness.” As you increase your income, payments will increase. This allows for manageable monthly payments.

2. Fixed Interest Rates – federal loans generally have lower interest rates than private loans. Additionally, regardless of changing interest rates, yours will remain fixed throughout your repayment period.

3. Free Insurance – hopefully you never need to utilize this, but it’s nice to know if something happens to you (disability or worse, death), your loan is canceled.

4. No Prepayment Penalty Fee – Sometimes, private lenders will charge a fee for paying off loans early. Why? They lose out on interest. With federal loans, you don’t have to worry about it. If you can pay off your loans quickly and avoid paying thousands extra in interest, good for you!

5. Public Service Forgiveness – unlike private loans, federal loans are eligible for public service loan forgiveness. If you find employment with a local, state or federal government agency or a tax-exempt non-profit, you may be eligible for loan forgiveness after 10 years.

6. Loan Consolidation – Federal loans can be consolidated into a Direct Consolidation Loan. This means lumping all of your existing loans into a single new loan. It can also help provide a way out of loan default.

7. Subsidized Loans – students who demonstrate financial need will often qualify for federal subsidized loans. With a subsidized loan, the government pays interest on at least a half-time basis while you’re attending school.

8. No Credit Check or Cosigner – oftentimes, private loans will require a credit check and/or cosigner. This can make it more challenging to get approved. Federal loans are available to pretty much anyone who demonstrates need.

9. Interest May Be Deductible – interest on both federal and private student loans may be tax deductible if you meet certain criteria. Talk with one of IntelliTec’s financial aid representatives for more details here.


Today’s Take-Away: Saving even just a small amount of cash now makes you feel more confident about your ability to pay for college. You’ll start to feel you have greater control over your life and your future and it will lead to an even stronger ability to deal with financial matters in your financial future.








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