It's not uncommon for students to sign for student loans without looking into interest rates or shopping around for better deals. For students, however, it's best to look at all of the options before signing on the dotted line.
"Students can easily call different banks and compare the rates each bank has to offer and pick the lowest deal," said Dan Ryan, director of Career Services. "Students are encouraged to know as much as they can about their loans, so that they are able to negotiate a lower interest rate."
Dan Pastuf, a freshman aerospace engineering major, is aware of the interest rate he is paying, but feels his education is worth it.
"I took out a federal loan and my interest rate is eight percent. I took out the loan because my tuition has to be paid, and my education is important to me. I think the interest rate is somewhat reasonable," Pastuf said.
Steve Szatynski, a sophomore psychology major, already has plans for after graduation that may affect his ability to pay back loans.
"I want to put off paying back my loans until I get a job, but I think it's going to be difficult," Szatynski said. "I have plans to teach English in Japan. However, I wont be in school and they will expect me to start paying them back."
According to Ryan, students need to be aware of when they will need to start paying back their loans after they graduate and whether or not they will be able to defer the process for a certain amount of time, depending on individual circumstances.
Even students who obtained loans at decent interest rates worry that the job market will be too weak to allow them to pay off their loans on time.
"I got a direct loan for about six percent interest, which I thought was a pretty decent rate. I am concerned about paying it off because I only have a limited time to start paying...and I'm worried I may not get a job right away," said Yun Zou, a sophomore pharmacy major.
According to Ryan, anyone looking into taking out a loan should look at all of their options after graduation. Students are given the opportunity to consolidate their loans and shop around for a better interest rate than they originally received. If students consider this option, they should look at all the benefits offered by different institutions.
"Even after they graduate students should look for the best deal. Interest rates have gone down the past 18 months and they may be able to re-negotiate for a lower rate," Ryan said.
According to Ryan, students can make themselves better candidates for lower interest rates by having good credit, which means paying off credit cards, avoiding tons of store credit cards and keeping up with their credit reports.
"The better credit score students have, the better their chances are of lowering those interest rates when the time comes," Ryan said.
