Student Loan Refinancing - Types of Loans

It’s time to tackle your student loan repayment. You have invested in yourself and are hopefully making an income that will support your lifestyle and repayment of your debt. Navigating the types of loans, repayment plans, loan consolidation, and refinancing opportunities can be a daunting task. Loot is here to try to simplify the decision making process for you!

There are two main types of student loans that you may have:

1. Federal Student Loans

2. Private Student Loans

Federal Student Loans

Within the federal student loan category there are several possible loan types:

1. Direct subsidized loan

   • Subsidized loans are loans that you may have qualified for based on you or your family’s income. Subsidized student loans do not accrue interest while you are enrolled in school.

2. Direct unsubsidized loan

   • Unsubsidized direct loans are offered directly to students and are not based on financial need. Interest accrual begins immediately.

3. Direct subsidized and unsubsidized Stafford loans (No new loans of this type have been made since July 1, 2010)

4. Direct PLUS (parent loan for undergraduate student) loan

   • Direct PLUS loans are loans taken out by a parent to assist in paying for tuition and expenses. The payments for these types of loans begin at the time of disbursement, not at completion of the degree or unenrollment.

5. Direct grad PLUS loan

   • Direct grad PLUS loans are loans taken out by a student to cover graduate or professional school tuition and expenses. These payments begin after completion of the degree or unenrollment from school.

Private Student Loans

1. Independent Private Student Loan

   • You applied for this loan yourself without a cosigner

2. Cosigned Private Student Loan

   • You and another person (usually a parent) applied for the loan with the cosigner (parent) providing credit that the loan will be repaid.