Education » Articles » Get To Know Financial Aid

Paying for College

Your college education is one of the most important investments you can make. In order for you to achieve your higher education goals, you may need to borrow. Here's a breakdown of the different types of student loans, and how they could work for you.

FAFSA & Federal Loans

Filling out a Free Application for Federal Student Aid (FAFSA) at the beginning of each calendar year is the first step to receiving any type of financial aid, be it federal loans, private loans, grants or qualifying for a federal work study program. When it comes to financial aid, it's best to start the process as early as possible. Start planning for the 2012–2013 school year in January 2012.

Read more about financial aid process and annual timeline that students should follow »

Once you've filled out your FAFSA, you'll be able to see what federal aid you qualify for. The most common loan from the federal government is the Stafford Loan. The interest rate is lower than most educational funding, and payments are deferred until you leave school. For more information about a Federal Direct Stafford Loan, visit your school's website or the Direct Loan website.

Private Student Loans

If you find that you didn't get enough funds from your federal aid to cover your second semester expenses, fill in the gap with a Private Student Loan. Borrow up to the cost of education minus any other financial aid you've received. Be sure to utilize all available federal options before pursuing a Private Loan.

You can borrow up to $12,500 per school year (with a $40,000 lifetime limit). Defer payments while attending school, take up to 12 years to repay and take advantage of our cosigner release option after 36 consecutive on-time payments. Plus, take advantage of our low rates:

• Variable Rate Private Student Loan: Get a rate as low as 3.58%.^*
• Fixed Rate Private Student Loan: Get a rate as low as 7.49%^* that is fixed for the life of the loan.

You can apply for a Private Student loan at uwcu.org. The process takes 4-6 weeks, so apply now to be sure your funds are disbursed for second semester.

See how long it takes to get a Private Student Loan »

* Variable Rate: 6.58% annual percentage rate (APR). The APR assumes that you will be in school for 4 years and have a 6-month grace period before repayment begins. Borrowing $10,000 at 3.72% accrues $1,674.00 in interest during 4 years in school and the 6-month grace period, resulting in 6.58% APR. Rate is variable and can change quarterly. For further information on rates and costs for the Variable Rate Private Student Loan, see the Application Truth in Lending Disclosure. Fixed Rate: 13.57% annual percentage rate (APR). The APR assumes that you will be in school for 4 years and have a 6-month grace period before repayment begins. Borrowing $10,000 at 7.49% accrues $3,370.50 in interest during 4 years in school and the 6-month grace period, resulting in 13.57% APR. For further information on rates and costs for the Fixed Rate Private Student Loan, see the Application Truth in Lending Disclosure You will be required to review the Application Truth in Lending Disclosure prior to submitting an application. For both Private Student Loans, the APR can differ from the interest rate as it considers fees paid to obtain the loan, your interest rate, if payments are deferred and reflects the cost of the loan as a yearly rate. You are not required to make payments on your loan while in school, although you may make principal and interest payments any time. Making payments while attending school will lower your APR. The minimum loan amount is $1,000. Your interest rate will be determined by your credit score or your cosigner's, whichever is greater