Federal Student Aid vs Sallie Mae

Federal Student Aid

• ✓Fixed interest rates set by Congress with no credit check for most loans
• ✓Access to income-driven repayment plans that cap payments based on income
• ✓Loan forgiveness programs including PSLF for public service workers
• ✓Deferment and forbearance options during financial hardship
• ✓No private lender can match the borrower protections of federal loans

Sallie Mae

• ✓Multi-year approval feature locks in funding for up to four years
• ✓Wide range of loan types covering undergraduate through professional degrees
• ✓Multiple in-school repayment options to manage costs while studying
• ✓Free scholarship search tool and financial literacy resources
• ✓Competitive rates for borrowers with strong credit or co-signers

Federal Student Aid

• !Annual and aggregate borrowing limits may not cover full cost of attendance
• !Interest rates are the same regardless of credit quality
• !FAFSA application can be complex and time-consuming
• !Parent PLUS loans have higher rates and fewer repayment options

Sallie Mae

• !Private loans lack the borrower protections of federal student loans
• !Variable rates can increase significantly over the life of the loan
• !Co-signer release requires 12 consecutive on-time payments minimum
• !No income-driven repayment or forgiveness options available

Federal Student Aid

• →Undergraduate student applying for financial aid for the first time
• →Graduate student needing loans with income-driven repayment options
• →Public service worker planning to pursue PSLF for loan forgiveness

Sallie Mae

• →Student who has maxed out federal aid and needs additional funding
• →Parent co-signing a loan wanting multi-year approval convenience
• →Graduate student seeking specialized professional degree financing

Federal Student Aid

Federal Student Aid, managed by the US Department of Education, is the starting point for all federal student loans including Direct Subsidized, Direct Unsubsidized, and Direct PLUS loans. The FAFSA application determines eligibility for federal aid, grants, and work-study programs. Federal loans offer fixed interest rates set by Congress, income-driven repayment plans, deferment and forbearance options, and access to loan forgiveness programs like Public Service Loan Forgiveness. Every student should exhaust federal loan options before considering private loans.

Sallie Mae

Sallie Mae is the most recognized name in private student loans, offering undergraduate, graduate, MBA, law, medical, dental, and career training loans. The company provides competitive rates with multiple repayment options including deferred, interest-only, and fixed repayment while in school. Sallie Mae also offers a multi-year loan approval feature that locks in approval for up to four years of college, eliminating the need to reapply each year. With robust scholarship search tools and financial literacy resources, Sallie Mae serves as a comprehensive education financing platform.