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Are Education Loans A Good Idea?
By David Jacobsen

Sometimes the choices in life can be tough - do you buy that nice, brand new car, maybe pay a large lump of your home - or do you pay for college? For many, the costs involved in four years of college are similar to paying for a car or half a house, and that’s a lot of money for most people.

So education loans can be an absolute blessing, giving you the chance to attend college without your family having to find the money upfront. They’re available for anyone who wants to attend college, and all you have to do is find the loan company and get accepted.

Basically, there are four main sources of education loans - the government, private funders, the Teem Esteem Foundation and consolidation loans, which are for when you’ve finished college.

Federal loans are available in two main categories - need-based and non-need-based. So let’s take a look at both. Need-based loans have low, affordable interest rates, discounts and deductions, such as the Stafford Loan. If you don’t qualify on a needs basis, then you will have to apply for something like a Federal Plus Loan, which is aimed at parents with children at the undergraduate student level. This type of loan can give you a borrowing allowance of up 100% of total college costs, plus discounts, and may have some tax-deductible features.

When it comes to education loans, a government student loan is probably the best choice, simply because of the variety of situations they are willing to consider for needs-based loans. So if you come from a one-parent family, or perhaps have elderly parents, but can show your excellent work prior to college, then you may be considered. Sometimes a student loan can simply relieve the pressure of trying to support yourself, which can interfere with your studies.

Private loans are a lot more complicated, because many different companies and individuals offer them. Still, they can be useful if you’re unable to qualify for a federal loan. Most allow you to defer interest while you’re still at school, and are often quite flexible in their repayment options. It’s usually quite straightforward to apply.

The Teen Esteem Foundation also offers education loans, and is supported by the primary loan institutions. The aim is to support families financially, and to emphasize concerned, involved support for families, rather than just handing out money.

Once you’ve finished college, a consolidation loan may be a good option to help you reduce your education loan repayments, or at least simplify things if you have more than one loan. However there are a wide range of factors to consider when refinancing, so make sure you either do your research or seek the help of a loan professional.

If you want to read more about education loans, click over to David’s site at http://www.info-about-loans.com

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IVAs ‘Not Best Option’ For Those In Debt

Britons are showing a lack of awareness when it comes to methods of managing their debts, a new study has shown.

According to a study conducted by moneysupermarket, about half of Britons (49 per cent) claimed to not know what an individual voluntary arrangement (IVA) is. However, given the high levels of advertising the product is receiving and increasing concern over debt levels, the price comparison website claimed that it is “staggering” that so many people are unaware about what the arrangement, which may be taken out by those struggling to pay off loans and credit cards, actually involves.

Meanwhile, government research has shown 11,105 IVAs were taken out in England and Wales between April and June - a rise of 35 per cent from figures recorded during the previous quarter. However, moneysupermarket suggested that many of those signing up for the agreement may not be truly aware of what they are getting themselves into.

Overall, young people were shown to have the least amount of knowledge about the product as 64 per cent of 18 to 24-year-olds are unable to say what it actually it. The findings also showed that men possess a greater awareness as 42 per cent claim to not know what the product is, in comparison to 56 per cent of women.

More than half of Britons surveyed stated they would consider getting an IVA if they developed “serious” problems in making repayments on personal loans and other forms of borrowing. With 40 per cent claiming that they would only do so as a last resort, 17 per cent reported that they are a good alternative to being declared bankrupt. As a result, moneysupermarket suggested that consumers are unaware of the arrangements’ “true consequences”.

Tim Moss, head of debt for moneysupermarket, suggested that opting for an IVA is unlikely to be the best option for the majority of borrowers in the long-run. He said: “For people suffering from spiralling debts, an IVA might seem like an ideal escape route. However, an IVA is not something that should be entered into lightly and without considered thought. It is a serious financial agreement with creditors that will typically last five years. Once entered into, it will make obtaining any forms of credit, even for such everyday items as a mobile phone contract, almost impossible.”

“There are many simple and practical steps people can take to get to grips with their financial situation before taking a drastic step such as declaring bankruptcy or entering into an IVA,” Mr Moss added. He claimed that consumers struggling to pay back money owed on loans and credit cards should look to seek advice from a professional advisory service such as Citizens Advice. Meanwhile, reducing unnecessary expenditure and switching to competitively-priced borrowing products was also suggested. In addition, taking on a second job as a means of bringing in extra cash was revealed to be a way of managing debts.

Last month, Ian Boden-Smyth, spokesperson for the UK Insolvency Helpline, claimed that creating a budget should be the first step taken by those with seemingly unmanageable debt difficulties. He added that asking for guidance from professional advisory organisations, in addition to opting for a debt consolidation loan, could also be a way in which to get their finances back into the black.

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About the Author

Abbi Rouse writes for All About Loans. Visist us today to apply for secured loans, personal loans, and debt consolidation loans.