EDUCATIONAL CREDIT, ITS FUNCTIONALITY
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Educational loans are very useful when we can’t do an expenditure in the education of our children, either because at that moment our finances are not in optimal conditions, or because we don’t have enough liquidity.
This type of credit is a service intended for students, enabling them to appropriately cover a part or the total of the cost of their college tuition, and the balance of it is paid until the student finishes his career.
Regularly, educational institutions are responsible to be intermediary with the banks, which are those who provide this kind of credits. The main characteristics of these credits are that they have a much lower than the regular rate, and paying only the interest that they generate each month, instead of the tuition.
For the liquidation of the credit is defined a term corresponding to the same space of time that the student used it, i.e., if someone has a loan for four years, has the same length of time to pay it.
Please note the following when contracting a loan of this type:
- Commissions. All payments that should be associated with the cost of the credit (opening, penalties, etc).
- Interest rate. It is the cost of credit, expressed as a percentage and is set since they give you the credit. Educational credits it is common that this rate remains fixed for the duration of the credit.
Is the credit a scholarship?
Not. Grants and loans are two very different things. There are scholarships in which the student not has that contribute any amount, i.e., studies of way free, in Exchange for meet requirements as keep an average of excellence e involved is in certain activities of its University.
Another type of scholarship is the beca-financiamiento, which means that, a part of their studies will be free, and another part, funded. For example, someone may have a scholarship that covers 35% of their studies, and funding that covers 15%, which means that the remaining 50% is paid in the normal manner. In other cases can be the 50% of scholarship and the 50% of funding. These percentages are defined directly with the educational institution, depending on what type of payment policies and credits apply taking into account the academic history of the student.
By other side, a funded race, or an educational funding, refers to that the student develops his preparation supported with a loan that will pay after completing his professional career. This loan can be made by the school or through a banking institution, as we have already mentioned it.
All three are good choices and must choose which works best according to their economic capacity. In addition, it is important that you analyze the advantages and disadvantages of request an educational credit, as if for some reason you cancel it before the deadline, you will have to begin repaying it immediately. Carefully check the terms and conditions of the same.
Approaching schools to request reports, each one has different plans and alternatives. For example, some allow that work in the school to the same time that studies, and of the wage that you give discounted a part that is paid to his credit.