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Student Personal Loan

Many college and vocational school students find themselves faced with expenses that may not be covered by student loans and grants. Examples of expenses that may not be covered by student loans include textbooks, computers, software, housing, transportation and meals.

A student personal loan is a means of finance designed to help students cover the cost of these expenses. Unlike a traditional student loan; which can only be used for tuition, a line of credit is an amount of credit that the student can use for whatever purpose they wish.

Unlike a student line of credit, a student personal loan is a fixed amount of money that the student will have to pay back. A student personal loan usually takes the form of a direct loan from the school or a lending institution associated with the school to student.

Advantages to a Student Personal Loan 

One advantage to a student personal loan is that is not an open ended arrangement. The student will have a fixed amount to pay off and no temptation to keep using credit. Another is that the student can pay it off while they are in school so they can graduate without debt.

A student could for example pay off all or part of the student personal loan by working at a summer job and the personal to cover expenses during the school year. This could help a student concentrate on their studies and avoid the necessity of getting a part time job.

Another advantage to a student personal loan is that it can be used to cover emergency expenses unrelated to education such as medical bills, insurance, food, transportation and housing. Using a student personal loan can help a student avoid spending grant and traditional student loan money to pay off expenses.

Sources of Student Personal Loan

The first place that a student should search for student personal loans is their school’s financial aid office. Many colleges, universities and vocational schools make student personal available to students. Most institutions of higher learning have arrangements with lenders to make student personal loans available to qualified students.

Many banks will make student personal loans available to qualified students. Students who are studying for degrees in certain fields will be more likely to get student personal loans than others. Many online lenders have student personal loans available for students.

Credit unions and banks associated with colleges or universities will often make student personal loans available to students. Students at the college associated with the financial institution may get a better deal on student personal loans from these lenders.

Disadvantages to a Student Personal Loans

A student will have to pay off a student personal loan sooner or later. Many students graduate school with a large amount of debt because of student personal loans. Quite a few college graduates find their incomes limited because they have to spend most of their money to pay off student personal loans.

Students can reduce the cost of student personal loans by getting the lowest interest rate possible. A student should always try to get a student personal loan with the prime rate of interest. The prime interest rate is the interest rate that lenders give to their best customers so it is usually the lowest interest rate.