Navigating Student Loans
08/12/2025
What are Student Loans?
Student Loans are funds borrowed to help cover the cost of college, university, or career school tuition, supplies, and living expenses. Unlike grants or scholarships, loans must be repaid with interest. While they can make education accessible to more people, loans come with responsibility and potential consequences if not managed properly. Repayment terms, interest rates, and borrower protections vary depending on the type of loan.
Federal Loans vs Private Loans
There are two main categories of Student Loans: Federal and Private. Federal Student Loans are funded by the U.S. government and typically offer lower interest rates, flexible repayment plans, and benefits such as deferment or income-driven repayment options. They come in two types: subsidized and unsubsidized. Subsidized loans, available to undergraduate students with financial needs, have the government cover the interest while you're in school, and the six months after you graduate. Unsubsidized loans, which are available to both undergraduate and graduate students, require you to pay the interest from the time the loan is disbursed, even while in school.
Private Loans, on the other hand, are offered by banks, credit unions, and other private lenders. These loans often require a credit check and/or a cosigner, and may come with higher, variable interest rates. Along with this, they tend to offer fewer borrower protections. While private loan can help to bridge financial gaps, they should be considered once your federal loan options have been exhausted.
The Power of Refinancing
Refinancing student loans can be a strategic move to help reduce interest rates, lower monthly payments, or shorten the terms of your loans. This process involves taking out a new loan to pay off one or multiple currently existing student loans, ideally at better terms. Borrowers with strong credit and stable income may benefit from refinancing. However, it’s crucial to understand that refinancing federal loans into private loans may result in the loss of the previously mentioned federal protections and loan-forgiveness options. Refinancing should be approached with careful financial planning.
How GPO Can Help
Student Loans can be wonderful tool to help people reach higher education, but must be handled cautiously and with careful financial consideration. GPO is committed to helping those on their financial journeys through and after education. GPO offers competitive rates, with no origination or repayment fees. You can finance or refinance, and being a local partner, you can expect quick decisions. With careful planning, responsible borrowing, and a proactive approach to repayment, student loans don’t have to be a burden- they can be a stepping stone to success.