Federal Student Loans - Direct vs. FFEL

[amp3r5and]

Just wondering, can anyone tell me what the advantage would be to take out FFEL loans instead of direct loans if you have no previous loans (and thus no relationship established with an outside lender already?). Seems to me the direct loans have lower interest rates and would be more stable than FFEL since the dept of education is the lender.

I'm new to student loans/financial aid. I'm finding the whole process very confusing.

thoughts?

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[236116]

Doesn't it depend on what your school does?

I don't think you really get to pick which you get.

 

[Forthegood]

Jurassicparkgirl-- Haven't seen you in a while!

OP- I took my loans from the dept of education using the direct program. Our school offered both directs and staffords.

I chose directs because it is a safer bet. If your school doesn't offer anything but stafford, then I would choose a Sallie May or some other large distributor for safety sake.

As you will see, this process is heavily dependent on your school and the options afforded you by said school.

BTW-- the loan rates should be identical (not close, but IDENTICAL). Stafford loaners may offer end-of-term benifits... (check the payment fine print and also look at capitalizations)

 

[amp3r5and]

Jurassicparkgirl-- Haven't seen you in a while!

OP- I took my loans from the dept of education using the direct program. Our school offered both directs and staffords.

I chose directs because it is a safer bet. If your school doesn't offer anything but stafford, then I would choose a Sallie May or some other large distributor for safety sake.

As you will see, this process is heavily dependent on your school and the options afforded you by said school.

BTW-- the loan rates should be identical (not close, but IDENTICAL). Stafford loaners may offer end-of-term benifits... (check the payment fine print and also look at capitalizations)

Thanks, Forthegood. Yeah, my school offers either option and I'm probably going to go direct because it seems a safer bet as you said. With the loan rates, your correct that the Stafford rates are identical but there is a slight dif (at least according to the info i have) on the PLUS loans depending on if you do direct or FFEL.

 

[236116]

Jurassicparkgirl-- Haven't seen you in a while!

Real life.

What's up with you?

 

[jinx520]

hey, Jurassic, I was starting to wonder where you went. 🙂

FWIW, I just applied to consolidate my grad school loans (FFEL) via Direct Loans b/c they apparently are the only ones doing consolidation right now. Hopefully that will halve my monthly payments.