United States
In the United States, there are two types of student loans: federal loans sponsored by the federal government and private student loans. The overwhelming majority of student loans are federal loans. Federal loans can be "subsidized" or "unsubsidized". Interest does not accrue on subsidized loans while the students are in school. Student loans may be offered as part of a total financial aid package that may also include grants, scholarships, and/or work study opportunities.
Prior to 2010, federal loans were also divided between direct loans--originated and funded by the federal government--and guaranteed loans, originated and held by private lenders but guaranteed by the government. The guaranteed lending program was eliminated in 2010 because of a widespread perception that the government guarantees boosted student lending companies' profits but did not benefit students by reducing student loan costs.
Federal Student loans are generally less expensive than private student loans. However, the federal student lending program still generates billions of dollars in profit for the government each year, because the interest payments exceed the government's own borrowing costs, loan losses, and administrative costs. Losses on student loans are extremely low, even when students default, in part because these loans cannot be discharged in bankruptcy unless repaying the loan would create an "undue hardship" for the student borrower and his or her dependents. In 2005, the bankruptcy laws were changed so that private educational loans also could not be readily discharged. Supporters of this change claimed that it would reduce student loan interest rates.
Read more about this topic: Student Loan
Famous quotes related to united states:
“It is a curious thing to be a woman in the Caribbean after you have been a woman in these United States.”
—Zora Neale Hurston (1891–1960)
“The real charm of the United States is that it is the only comic country ever heard of.”
—H.L. (Henry Lewis)
“When, in some obscure country town, the farmers come together to a special town meeting, to express their opinion on some subject which is vexing to the land, that, I think, is the true Congress, and the most respectable one that is ever assembled in the United States.”
—Henry David Thoreau (1817–1862)
“Europe and the U.K. are yesterday’s world. Tomorrow is in the United States.”
—R.W. ‘Tiny’ Rowland (b. 1917)
“What lies behind facts like these: that so recently one could not have said Scott was not perfect without earning at least sorrowful disapproval; that a year after the Gang of Four were perfect, they were villains; that in the fifties in the United States a nothing-man called McCarthy was able to intimidate and terrorise sane and sensible people, but that in the sixties young people summoned before similar committees simply laughed.”
—Doris Lessing (b. 1919)