What are the Top Benefits of Student Loans?

February 16, 2019

Student loans are an ever-present aspect of the modern school system. College entry fees are no joke, and most students don’t have the funds necessary to cover them.

In another time and place, a lack of funds would mean someone just didn’t get to go to college. But thanks to the modernity of the student loan, this issue can be absolved. Loans allow students who would otherwise be out of luck, the opportunity to attend college.

What is it about student loans that have made them such an integral part of the college experience? Let MaxCash walk you through student loans to show you why and how they’ve come to define the college experience.

What is a Student Loan?

Always best to start with the basics when covering any topic. Student loans are a subset of loans intended to help students obtain the funds they need to pay for entry to attend college. In many ways, they’re rather similar to other types of loans.

Student loans cover large expenses with a big up-front payment, with a series of smaller repayments promised later. However, they generally have a few specific traits that set them apart from the other varieties of loans.

Like most types of loans, student loans have specifications as to how they’re allowed to be used. In the case of student loans, it’s that funds can only be used on things related to the college education of the intended student. This can include expenses such as college tuition, books, and supplies, but also less obvious ones like living arrangements and groceries.

Next up is exactly how repayment works. Unlike most other types of loans, repayment of student loans doesn’t begin immediately. Instead, students don’t begin repaying them until they are through with the college process. This means that there’s generally a four-year window during which the student doesn’t have to make any loan payments.

The Best Benefits of Student Loans

Now that we’ve defined exactly what student loans are, it’s time to cover some of their many benefits. Some benefits are related to the information previously covered, but others are all-new.

This information is helpful for those interested in attending higher education and will likely result in a new appreciation for just how much student loans can offer.

  1. Lower Interest Rates – Generally, student loans have lower interest rates than most other types of loans available. Depending on the type of loan and lender, you might end up with either a fixed-rate loan or a variable rate one. Variable rates may seem to offer lower rates than their competitors, but can vary wildly. It’s generally better to stick with a safe fixed rate than a volatile variable rate.
  2. Accepts All Credit – Student loans don’t need the usual credit check that most other loans require. This means that, unlike other types of loans, which end up having limited availability by comparison, student loans can end up being used by just about anyone!
  3. Less Prerequisites – If you have sub-par credit and try to obtain any other kind of loan, you’ll generally just end up getting your inquiry rejected. One way to counteract rejection is to get a co-signer, however this prerequisite won’t be needed for student loans. You could apply for a student loan without a co-signer or existing credit.
  4. Increased Savings Time – Student loan repayment won’t start until at least the end of the schooling period for graduated students. However, you can push this starting point back even further by up to three years if you’d like. This allows students extra time to snowball funds before they start repaying the debt in full.
  5. Avoiding Extraneous Interest – Many other types of loans result in interest that starts to stack up right from the beginning, but student loans avoid this. Instead, during the time you aren’t paying the loan, either during the school tenure or during a delayed payment start, the government will pay off any interest that accrues.
  6. Easier Forgiveness – Most types of loans will start to damage your credit as soon as you miss a payment. Missed payments might also result in lawsuits or other methods of payment recovery. However, student loans have a longer forgiveness period, giving you a three-month window before a missed payment is reported. It’s then another six months before you fall into default and recollection starts.

And these are just some of the numerous benefits that can come as a result of proper utilization of student loans. Interested in knowing more? Want to learn how to get the most bang for your buck out of your student loan? Or maybe you’re interested in learning about the process of getting one? For the answers to all these questions and more, check out MaxCash’s section on student loans.

The MaxCash website does not offer or provide loans, but rather, it offers a service. It should not be construed as a lending agent or broker. The site does not endorse any lenders and does not charge visitors any fees. The website owners do not evaluate potential lenders’ applications, nor do they approve or deny credit. The MaxCash website does gather applicants’ personal information and transmits it to lenders that are part of the site’s lending network. No one is required to make use of this website, nor are they under any obligation to begin contact with site operators or to attempt to secure a loan with any of the site’s lending partners. Transmission of your financial and personal information on the website in no way obligates lenders to offer you a loan or any other kind of credit product. Be aware that cash transfer times can vary, depending on the lender and the bank you use. It may be necessary to fax information under certain circumstances. All questions about loans, and any concerns you may have should be directed to your lender. These loans are intended as short-term financial solution to satisfy borrowers’ needs for immediate monetary relief. This is not intended to be part of a long-term financial plan for individuals. These services are not offered in all states. Potential borrows may undergo credit check if lenders choose to use any of the major credit reporting bureaus, including Equifax, Trans Union and Experian. They may also use other alternative sources to check credit ratings. Your request for a loan constitutes your agreement and acknowledgement that (A) your personal data may be shared with lenders and perhaps other third-party partners, and (B) lenders can acquire credit bureau reports that detail your credit history. Reports from major credit bureaus, such as Equifax, Experian and TransUnion may be obtained and used to evaluate your reliability as a borrower.

1Loan amounts by the lenders vary based on qualifications.

2Since we do not lend money directly we cannot offer you a solicitation for a loan. In all serviced states we WILL match you with a lender based on the information you provide on this website. We will not charge you for this service and our service is not available in all states. States that are serviced by this Web Site may change from time to time and without notice. Personal Unsecured Loans are not available in all states and all areas.

3Loans such as, Auto Title Loan companies typically do not have pre-payment penalties, but we cannot guarantee that every lender meets this standard. Small Business Loans typically do have pre-payment penalties and occasionally will use your car as collateral to secure the loan. Other types of loans may have pre-payment penalties as well.

4All lenders are responsible for their own interest rates and payment terms. Max Cash has no control over these rates or payments. Use of the work competitive or reasonable does not mean affordable and borrowers should use their own discretion when working directly with the lender.

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Loans such as Car Title Loans are expensive and you may have other ways to get funding that is less expensive. These types of loans are meant to provide you with short term financing to solve immediate cash needs and should not be considered a long-term solution. Residents of some states may not be eligible for a loan. Rejections for loans are not disclosed to our firm and you may want to contact the lender directly.

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