Student Loans in Indiana

Student loans are one way to help finance your college education. There are several types of loans and each has different qualifying and repayment aspects. It’s important to know what the requirements are before taking loans so you can follow the necessary repayment rules later on.

Students can receive college loans from the federal government, state governments, colleges and even private organizations. Loans differ from grants and scholarships because they all have to be paid back and they accrue interest over time on the initial amount borrowed.

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How do people get student loans?

There are a few different ways to obtain student loans. The most common way is to apply for federal financial aid. You can also get private loans from banks or other lending institutions.

The FAFSA is the most important document for determining if you’re eligible for financial aid. Check out our FAFSA guide for Hoosiers for more information.

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How do student loans work?

Student loans can be an essential part of your financial aid package. One thing to keep in mind is loans must be repaid with interest. You are responsible for repaying the loan if you borrow money for your education. 

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What are the different types of loans?

When choosing a student loan, it’s important to compare interest rates, repayment terms and fees. You should also consider whether you want a fixed-rate or variable-rate loan. Fixed-rate loans have interest rates that stay the same for the life of the loan, while variable-rate loans have interest rates that fluctuate.

There are several different types of student loans you can apply for, including:

  • Federal Loans
    • Subsidized Loans
    • Unsubsidized Loans
  • Private Loans

To see if you are eligible for Federal Student Loans, Subsidized Loans and/or Unsubsidized Loans, all you have to do is...

Federal Student Loans

Federal loans are generally the most secure type, usually have the lowest interest rates and fall into two categories: subsidized and unsubsidized non-need-based student loans.

Subsidized Student Loans

This particular type of loan means the government pays the interest on the loan while you are enrolled in school. Once you are no longer enrolled, the loan will start accruing interest, which you will be responsible for paying on top of your original loan amount. Subsidized federal student loans are need-based and are offered to students based on their financial need as determined by the FAFSA. Colleges use the information on your FAFSA to determine eligibility. When colleges receive your FAFSA information, they award need-based loans and Federal Perkins Loans to students with the highest need.

Unsubsidized Student Loans

Unsubsidized loans are traditional loans that begin accumulating interest as soon as you start receiving them. You will be responsible for paying the original loan amount and the loan interest that accumulates while in school. Federal unsubsidized loans are not based on financial need. An example of this type of loan is the Federal Parent PLUS Loan, which allows parents to borrow to cover the total cost of college, minus any financial aid received.

Private Student Loans

Generally, private loans are not subsidized or need-based. These loans often require a parent to commit to repaying the money as a co-signer on the loan if the student fails at repayment.

Banks and other financial institutions provide these, so private loans usually have the highest interest rates. You should try to get as many federal loans as possible before turning to private loans.

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How should I repay my student loans?

If you’ve borrowed money for college, it’s essential to repay it responsibly. If you have federal loans, programs are in place to help you if you are unemployed or can only make low monthly payments. Learn more about these programs from the office of Federal Student Aid.

Use these tips to ensure you are repaying your loans responsibly:

Start early

If you can pay off interest while still in college, you’ll save money in the long run. Remember, your loan repayments will consist of a principal (the original amount you borrowed) plus interest. The longer you take to pay back your loans, the more you’ll pay in interest.

Calculate your payment

Find the loan repayment plan that works for you before the bill arrives. Use the loan calculators from If you have federal loans, explore your repayment options, including loan consolidations or deferment.

Keep your lender informed

Keep your lender informed of changes in your name, address, email address, phone number, Social Security number or school enrollment status.

Make loan payments regularly

Make loan payments regularly, even if you don’t receive a bill or repayment notice. Billing statements are sent to you as a convenience, but you have to make payments even if you don’t receive any reminders.

Don’t default

Failing to pay back your loan can be severe and long-lasting. Your credit rating could be damaged, and you might not be able to take out loans for future expenses — such as a car or mortgage — or receive your federal income tax refund (which will be applied to your loan balance instead).

Ask for help

Repayment options can assist you if you’re having trouble making your loan payments. Your lender is more likely to be flexible if you are proactive about seeking help.

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Student loan forgiveness in Indiana

There are a few Student Loan Forgiveness programs specific to Indiana and a few Federal Loan Forgiveness programs options. Contact your local loan officer for further details on the best choice for your situation.


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