Federal student loans come with
- lots of consumer protections
- fixed interest rates
- many repayment options (including an income-based option that strongly reduces payments)
- debt forgiveness after 20-25 years
Private student loans, on the other hand, come with
- very few consumer protections
- variable interest rates (risky!)
- very few payment options
- debt never expires
Using private student loans is like paying for college with credit cards! But there’s one critical difference — credit card debt can be discharged in bankruptcy but private student loans can not. Private student loan lenders can pursue you to your grave.
Stick to federal loans because they have a lot of protections and advantages. Limit yourself to borrowing no more than what you expect to make the first year out of college.