If you're borrowing from the first lender you find, you could be leaving money on the table by paying a higher interest rate than you would with another lender. The rates you're offered on your student loans can vary drastically from one lender to the next. A private student loan with a longer term will typically have a higher interest rate attached, but will result in paying less per month since you have more time to pay your loan off. Shorter loan terms will typically come with lower interest rates, but will mean higher monthly payments since you have less time to pay off your loan balance and interest. Your loan term can also have an impact on the interest rates you're offered on private student loans. On the other hand, variable rates could start higher, but could drop in tandem if interest rates fall in the future, which could potentially save you money. Private student loans can come with fixed or variable rates, and each type of interest rate has potential benefits and downsides, so weigh them and determine what may work best.įor example, student loans with fixed rates will typically come with lower rates to start, but if rates drop over time, you'll continue to pay the higher rate of interest on your student loan. In order to get a good student loan rate, consider the following. If you're planning to use private student loans to pay for some or all of your education costs, it's important to maximize your chances of getting the best rate possible on your loans. That means the rates on these loans, which are typically offered by banks, credit unions, or private student loan lenders and other financial institutions, can vary - sometimes drastically - based on the lender, the loan terms and other factors, like your credit score and overall creditworthiness. The rates for private student loans are set by the lender.
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