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Author Topic: Grad PLUS Loan vs. Private "Alternative" Loan  (Read 838 times)

nsre421

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Grad PLUS Loan vs. Private "Alternative" Loan
« on: July 07, 2006, 12:49:08 PM »
Does anybody know which is better?

onepoint

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Re: Grad PLUS Loan vs. Private "Alternative" Loan
« Reply #1 on: July 07, 2006, 12:51:44 PM »
it will come down to the interest rate.  federal PLUS loans are locked around 8.5% i think, while most private loans fluctuate.

as a side note, does anyone know how long the deferment period is after graduation?  i think with my private loans from this past year, i have 6 months after graduation to find a job and get settled before i have to start paying.
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strycat5

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Re: Grad PLUS Loan vs. Private "Alternative" Loan
« Reply #2 on: July 07, 2006, 01:59:38 PM »
Grad PLUS are WAY BETTER than private loans! Here's why:

Interest Rates               

Grad PLUS = 8.5% FIXED                
Private = Variable based on prime (typically prime rate plus 1%) 
current prime---> http://www.bankrate.com/brm/ratewatch/wsjPrimeRate.asp

               
Interest Rate Caps            

Grad PLUS = 9%               
Private = NONE (some states will have general interest rate caps typically around 20%)


Repayment Options            

Grad PLUS = Standard, Graduated, Extended, Income-Sensitive      
Private = NONE


Deferment Option

Grad PLUS = YES
Private = NO                              


Grad PLUS Loan Discounts             

Grad PLUS = YES Interest rate reductions and principal reductions for on-time payments   
Private = NO   

jason1114

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Re: Grad PLUS Loan vs. Private "Alternative" Loan
« Reply #3 on: July 07, 2006, 05:57:49 PM »
Also, GRAD Plus loans can be consolidate w/ regular Stafford.

violaterra

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Re: Grad PLUS Loan vs. Private "Alternative" Loan
« Reply #4 on: July 10, 2006, 07:43:12 PM »
With the except that some Grad plus loans may not get disbursed until Oct(due to the newness of the program)...sure its better.
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