During today’s economic uncertainties the thought of being able to afford college is a question that lingers in the mind of students and parents alike. The process of looking for a low interest student loan may seem like a huge undertaking. There are some government programs available for those who qualify with fixed interest rates ranging from 6% to 8.5%.

At the time of this writing the Obama education administration is looking into passing a bill through congress that would revamp the current student loan program. By doing so the government would save over 48 billion dollars over a decade while increasing funding to the Pell grant program and enable more students to go to collage. Opponents of the bill argue that the change will enable more government control. President Obama declared recently in a press conference that the country is spending billions and billions of dollars in loans to institutions that full fill their own special interest. Instead why not make education more affordable to all Americans. The Canadian and some European governments already provide this type of education program making it available to everyone.

Low Interest Rates And Types Of Loans

There is another program on the horizon currently featured on CNN that provides low interest student loans by utilizing the student’s existing social network and investors. They go by the name of GreenNote perhaps that is another viable alternative.

The program works by having the student approach their network and ask for investors in their education. The company then backups up the loan reducing the risk for the lenders while offering an interest rate pay off. It may directions it may look like a win win to all parties involved.

By the end of this article you will have a clear consolidated idea of your options, current interest rates and where to begin.

You will find student loans most commonly segregated in three separate groups. What group you qualify for will depend on income and in some cases credit score.For both government guaranteed and government direct loans your credit is not important, it's based on your current household income.

Guaranteed student loans as the Stafford FFEL (Federal Family Education Loan) is a government program where lenders and institutions such as banks provide the loan while the government guarantees up to 97% of the amount provided to the applicant, thus almost eliminating the risk of the lender.

Direct loans as the name implies are funded directly by the government. If you are approved for a subsidized Stafford loan based on your income the interest are paid by the government (subsidized) and you will not have to start repayment until 6 months after you graduate. If on the other hand you do not meet the income requirements you might be approved for an “unsubsidized” loan which means you are required to start making the interest payments immediately and they are accumulated to the principal of the loan.

Your parents can also apply for PLUS Direct and PLUS FFEL loans. This approval process depends more on credit then on income requirements. The interest rates for PLUS loans are usually higher then Stafford loans however in most cases it might be a better alternative then private loans.

• Stafford subsidized loans expended on or after 7/1/2009 have a fixed interest rate of 5.6%
• Stafford unsubsidized loans expended on or after 7/1/2006 have an interest rate of 6.8%
• Loans from 7/1/1998 to 6/30/2006 have an adjustable rate not exceeding 8.5%
• FFEL PLUS Direct expended on or after 7/1/2006 have an interest of 8.5%
• Direct PLUS expended on or after 7/1/2006 have an interest of 7.9%

In the event you or your parent do not qualify for federal student loans the third alternative are private student loans institutions. The best way to find a low interest student loan will be first to address any credit problems that may exist, this will prove to the lender that there is a lower risk in lending you money. Consider using online resources such as lendingtree and your own banks website. Credit unions being non-profit organizations will usually offer better interest rates then any other institution in the private lending sector. If you have already graduated and have not done so already consider a student loan consolidation program that can adjust your interest rate with today’s market value.

Look into the GreenNote program it has been delivering very promising results, read the reviews and talk to others who have already been provided loans. Be very cautious when it comes to acquiring student loan debt.

1. Talk to your guidance counselor about your plans and to provide you with the appropriate forms. Also seek out to your network for people who have already been through the process, ask them about their experience and how to improve on what they did.

2. Visit the http://www.fafsa.ed.gov/ website and begin with step 1 of the application review process before actually submitting the application.

3. If the application is not approved visit lending websites such as lendingtree, GreenNote and your own bank.

4. Avoid when possible going through non government guaranteed lenders it will save you a lot of money in the long term.