Shop Around for the Lowest Interest Rates for Student Loans

The amount of money that most students need to borrow for their tuition, lab fees, study materials, and living expenses can run into the tens of thousands of dollars and sometimes even more, so shopping around for student loans with low interest rates is very important. Even if they've been saving from the time the child was young, rarely do students and even their parents have enough money to fully support the pursuit of a degree. Getting student loans with low interest is going to save the student and the parents hundreds and even thousands of dollars over the life of that loan.

Let's take a look at some numbers so that you can see how this adds up.

The Staggering Cost of Tuition Fees

Most students attend schools where tuition and other fees add up to about $9,000 per year. That's $36,000 for a four-year degree. As an example to illustrate the point, let's suppose that your student loans have an 8% interest rate. If you paid $435 a month it would take ten years or 120 months to pay down that debt and you will wind up paying over $16,000 in interest charges over the course of that loan.

That's like paying almost two more years of college tuition in interest charges alone!
To further illustrate how getting student loans with low interest can help you, let's lower that interest rate to 7%, a difference of only 1%. At the same $435 a month, it would only take you 114 months or nine and half years to pay off and you would pay just over $13,000 in interest charges. That means more than $3,000 you've saved in interest payments; that's $3,000 in your pocket rather than the pocket of your lender.

Check Out the Figures with a Online Calculator

With your student loan you might be very surprised to find out how much extra you would pay in interest charges or how much you might save, depending upon your rate. You can find out your own differences when it comes to student loans with low interest by going to any online loan calculator and then punch in the cost of your education and different interest rate percentages. Even a point or half of a point can mean hundreds and even thousands of dollars saved, or not.

Where to Get Low Interest Student Loans

So where do you get student loans with low interest? Most turn to the federal government as they have many programs designed to get students the money they need for school. Sometimes those applying to the federal government for student loans with low interest are surprised to find out that they're eligible for subsidized loans, meaning that the government will cover some of the cost of their loan. They may also find many scholarships and grants for which they're eligible, which is like free money for school.

Do Your Homework And Shop Around

Wherever your source, make sure you do your homework and really shop around for loans as a lower interest rate will mean literally thousands of dollars in your pocket.