Student Loan Rates Sallie Mae
Student loans are a way to pay for college, but they can also be one of the more confusing and challenging financial products. There are several different types of student loans, each with different rates and terms that affect how much you’ll pay back over time. Understanding your options can help you find a loan that’s better suited to your needs and budget—or even help you decide whether borrowing money for college is best in the first place.
There are many loan types, but this article focuses on the most popular. If you’re looking for more information about other types of student loans, check out our full glossary.
- Federal Stafford Loans: These are low-interest loans that are subsidized by the federal government. The amount you borrow is based on your need and how much money you make during college. You’ll be responsible for paying back this loan after graduation with interest (unless you’re eligible to have it deferred), but there may also be some forgiveness options available if you work in certain fields like teaching or public service.*
- Federal PLUS Loans: Parents who want help financing their children’s education can apply for these unsubsidized loans through the federal government.* Private Student Loans: These aren’t administered by any government agency; instead they get their funding from banks or other private companies specializing in lending money to students.* Parent PLUS Loans (aka Parental Plus): This type of loan offers parents who don’t qualify for Parental Plus an opportunity to access funds as long as they meet certain requirements.* Consolidation Loan: A consolidation loan allows borrowers with multiple types of student credit outstanding at once time and will refinance them into one single payment plan with a lower interest rate than before–this way borrowers can pay off debts faster without having extra fees added onto each individual account.”
Fixed rates are available for both undergraduate and graduate loans.
Fixed rates are typically higher than variable rates, but the fixed rate may be lower if you have good credit and a history of on-time payments.
Variable rates are based on the current market, so they can change over time. Variable rate loans are typically lower than fixed rate ones because they’re not guaranteed by the government or other entities, but there’s no guarantee your fixed interest rate won’t go up either. If you’re considering a variable-rate loan, make sure you understand how the interest rate is calculated (i.e., if it’s based on a benchmark like Prime + 1%) before signing on to one of these loans.
Annual Percentage Rate (APR)
You might have seen the acronym APR in advertisements or on your student loan paperwork. APR stands for annual percentage rate, which is basically the interest rate charged on your loan. It’s important to be aware of your annual percentage rate because it includes both fixed and variable rates, as well as other fees related to your loan.
The annual percentage rate is calculated by dividing an amount called the total amount financed by a number called the number of payments (a year). The total amount financed refers to how much money you borrow plus any extra payments or fees that are added onto your balance before you graduate from college. For example, if you borrowed $30,000 over four years at 6% interest and make monthly payments at $295 per month (principal plus interest), then after four years there will be $3500 left owing: $30 000 + ($295 x 48) = $35 005
You have a grace period after graduation to pay back your student loans. Grace periods vary by loan type and can be anywhere from 6 months to 2 years. For example, Sallie Mae allows an 18-month grace period on their private loans and Public Service Loan Forgiveness allows you to have a 10-year repayment term after your 120th payment.
The amount of time you have before making payments on your federal student loans varies depending on what kind of federal student loan you have obtained:
- Direct Subsidized Loans – You may not have to make payments until six months after graduation or when you no longer attend school at least half time (if you’re still in school), whichever comes first. Once this six-month period has passed, however, interest will begin to accrue on these subsidized loans according to their terms.
- Direct Unsubsidized Loans – If a borrower uses both types of federal student loans (unsubsidized and subsidized) over the course of his or her education career, the unsubsidized portion may be eligible for deferment if he or she meets certain criteria such as being unemployed through no fault of his own (the job must pay less than half of minimum wage). Interest will continue accruing until it reaches $2 per day—at which point it is capitalized (added onto principal balance).
If there are any remaining payments due on existing debt before beginning repayment under new terms offered by Sallie Mae Federal Loan Servicing Center Inc., then those monthly payment amounts will need
- The Sallie Mae Repayment Estimator is a tool to help you estimate your monthly payment and total repayment amount for a federal student loan. You can also get an estimate of your monthly payments when you apply for a private student loan.
- Changing the way you repay your loans can have a big impact on how much money you spend and how long it takes to pay off your debt.
- You can change the repayment plan for all of your federal loans by logging into NSLDS and making changes there, or by contacting your loan servicer directly.
Understand your student loan options.
You are currently in a grace period. Your first payment will be due after you graduate or drop below half-time enrollment.
The information in this section applies only to Federal Direct Subsidized Loans, Federal Direct Unsubsidized Loans, and Federal Perkins Loans. Private loans may have other terms and conditions that apply to them.
Your loan servicer will send you monthly billing statements with information about your current balance and the amount of any payments you owe each month. If you have questions about your billing statement or need help understanding what it means, contact us at [email protected]
There are many factors to consider when choosing a student loan, and it’s important to understand which option is best for you. The loans that we discussed in this post are just some of the many options available from Sallie Mae; we hope that this information helps you make an informed decision about your education financing needs.