Your Quick Quide to Student Loans With Low APR

Is a low interest rate becoming fiction nowadays? When times are getting tougher, one can only wonder if there’s such a thing as student loans with low APR. A low… what?! APR, that’s right, or short for Annual Percentage Rate. This simply means the total interest rate of your student loans in a year. For example, if you have a credit card that charges you one percent each month, that means you get to pay 12% APR or total for the whole year ( Do your math: 1% x 12 ). When you ask how much interest you’ll be paying each month, don’t ever forget to ask for your APR as well.

What Student Loans Can Give You a Low APR?

Know that your student loans’ Annual Percentage Rate, or APR, is variable – which means it can increase if LIBOR increases. LIBOR is short for London Interbank Offered Rate, which is the average interest rate which is paid on US dollar deposits in the London Market. Most banks also charge their credit-worthy clients with published PRIME ( Prime Lending Rate ) at the Wall Street Journal. Overall, APR is that very basis for interest rates and other fees charged on your loan. Since APR changes, here’s a list of loans and their APR rates ( in random order ):

Please Check Your Current LIBOR and PRIME rates online to make an accurate computation

1. Sallie Mae Smart Option Student Loan: 1-month LIBOR + 4.0%; 1-month LIBOR + 12.0% (with credit-worthy cosigner); 1-month LIBOR + 12.5% (without credit-worthy cosigner)

2. Charter One TruFit Student Loan: 1-month LIBOR + 3.00%; Maximum 1-month LIBOR + 13.00%

3. Citizens Bank TruFit Student Loan: 1-month LIBOR + 3.00%; Maximum 1-month LIBOR + 13.00%

4. Discover Student Loans: Minimum Amount of PRIME + 1.0%

5. StudentLoans.com: Minimum Amount of LIBOR + 1.8%

6. Sun Trust Academic Answer Loan for Undergraduates: Minimum Amount of 1-month LIBOR + 4.0%

7. Sun Trust Academic Answer Loan for Graduates: Minimum Amount of 1-month LIBOR + 3.5%

8. U.S. Bank No Fee Education Loan: Minimum Amount of PRIME + 1.95%

9. Wells Fargo Collegiate Loan: Minimum Amount of PRIME + 1.0%

10. Wells Fargo Graduate Loan: Minimum Amount of PRIME + 1.50%

11. Wells Fargo MedCAP Alternative Loan: Minimum Amount of PRIME + 1.50%

12. Wells Fargo Education Connection Loan: Minimum Amount of PRIME + 2.50%

13. Discover Graduate Loans: Minimum Amount of PRIME + 1.0%

For a complete listing of private student loan comparison chart, you may view it here.

What are the Best Loans with the Lowest Interest Rates?

To go for federal student loans will be your wise move to have student loans that come with a fixed interest rate, instead of a variable APR. Because of this, federal student loans are the most popular choices among many students nationwide:

1. Federal Stafford Loans

Have little or no credit? You can always apply for a subsidized or unsubsidized version of this loan. Currently, these are the fixed rates:

Loans disbursed between July 1, 2008–June 30, 2009: 6%

Loans disbursed between July 1, 2009–June 30, 2010: 5.6%

Loans disbursed between July 1, 2010–June 30, 2011: 4.5%

Loans disbursed between July 1, 2011–June 30, 2012: 3.4%

Loans disbursed on or after July 1, 2012: 6.8%

Subsidized loans for graduate students: 6.8%

Unsubsidized loan for undergraduates and graduates: 6.8%

2. Federal Perkins

This is the top choice for any students with the most needs, since it gives a low interest rate of only five percent, plus, the largest grace period for loan repayment after graduation.

3. Federal PLUS Loans

Loans disbursed starting on July 1, 2006: 8.5%

Loans disbursed on or after July 1, 1998 but before July 1, 2006: from 3.28% – 9%

For more information, you may visit private student loans.

Taking advantage of student loans with low APR will take a thorough research on your part. The path to your dream education is clear if you mix your efforts with perseverance. Be responsible enough to secure your future, for your own good. Stay Informed!

READINGS:

http://www.investopedia.com/terms/a/apr.asp

http://www.salliemae.com/get_student_loan/apply_student_loan/interest_rates_fees/

http://www.finaid.org/loans/privatestudentloans.phtml

http://www.gocollege.com/financial-aid/student-loans/federal/low-interest-loans.html