What Are the Benefits of Federal Student Loans?

Posted on July 25, 2018 at 12:00pm by
Picture of a Woman Pointing at Her Classmate's Computer

Whether you are approaching the end of your high school career or are seeking higher education later in life, you will have to answer the question: Where will I find the money to ensure a successful career? The vast majority of people seeking a college education will look to loans as their means of getting their degrees. There are a variety of institutions that are willing to fund an individual’s college aspirations, but what types of loans are best for you? What are the benefits of federal student loans?

Here is a short list.

  1. You do not need a credit history to obtain federal student loans. Whereas most private loans require some sort of credit history, federal student loans are available to any enrolled undergraduate that can demonstrate financial need.
  2. Federal student loans do not require a co-signer. If you are young and do not have much credit history, you understand how valuable it is to not need someone to co-sign on your loan.
  3. Federal student loans often offer lower interest rates than private loans. Even if you do find that your interest rates are higher than you are able to handle, you can still look into student loan refinancing.
  4. If you cannot afford your payments temporarily, you have options. Deferment allows you to postpone your payments for up to three years. You may also utilize forbearance, which allows you to put a pause on payments for up to a year at a time.
  5. There are many different types of student loan repayment plans. Some of these, such as REPAYE, allow you to tie your loan payments to your income.
  6. Federal loans are much more generous when it comes to defaulting. Many private loans will go into default as soon as you miss a payment. With federal student loans, you have many options that can help you preserve your credit score if you default.
  7. Good credit is not required to consolidate your federal student loans. Furthermore, if you do consolidate your federal student loans, you may also be able to make yourself eligible for Public Service Loan Forgiveness (PSLF) as well as income-driven repayment plans.


We understand that the decision to take out a student loan can be a complicated and uncertain one. The Sader Law Firm is a Kansas City bankruptcy and student loan law practice.

If you have questions about debt relief or student loan payments, we are here to assist you. Our attorneys have years of experience dealing with the complexities of student loans. You can reach out to us by calling  (816) 561 1818 or by using our online case review form.