Interest-Free loans


Sharia compliant interest free

Student loans that don't charge any interest—thus saving students thousands of dollars—sound like great deals.

But while interest-free loans are almost always better deals than private student loans made by banks or credit unions, they typically don't offer some of the benefits of federal student loans.

Here are some pros and cons to consider before committing to an interest-free student loan.

Pros:

Big savings: Students with no-interest loans pay back exactly the amount they borrowed. That saves thousands of dollars in interest over the long term. Students who borrow the maximum $27, 000 from the federal government's "unsubsidized" Stafford student loan program for four years' worth of tuition often end up repaying $10, 000 more than they actually borrowed because of added interest. Those who take out private student loans, which can charge higher fees and interest, can pay tens of thousands of dollars worth of interest.

Helping others: Many of the charities that make interest-free student loans use the monthly repayment checks to fund loans for other students, so your money is directly helping fellow students.

Cons:

Applications: Many of the charities require extensive essays or personal interviews. To qualify for federal student loans, students need only fill out the Free Application for Federal Student Aid, which most students have to fill out to apply for other financial aid anyway.

Co-signers: Some charities require students to find adults with good credit who will promise to repay the money if the students fail to do so. Federal student loans don't require co-signers.

Immediate repayment: Some charities require students to start making small monthly payments immediately. Federal student loans waive payments as long as students attend college at least half time.

No Forgiveness: Graduates who go into public service can have a portion of their federal student debts forgiven after 10 years of payments. Charitable loans don't qualify for the government's public service forgiveness.

Interesting facts

  • Islamic economics refers to the body of Islamic studies literature that "identifies and promotes an economic order that conforms to Islamic scripture and traditions," and in the economic world an interest-free Islamic banking system, grounded in Sharia's condemnation of interest (riba). The literature has been developed "since the late 1940s...
  • The Scholarship Foundation of St. Louis, founded in 1920, offers a comprehensive need-based academic scholarship program. Scholarship funding is derived from revenue produced at the two ScholarShop locations, respectively located in Clayton and Webster Groves.
    In the 2006-2007 academic year, more than $2.6 million will be made available to over...

Additional information


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Interest-Free Provincial Student Loan Program
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How to Borrow Money at Zero Interest: Legally Eliminate Your Debt in Record Time, Utilizing Inside Information that Banks and Credit Card Companies Don't ... to Know (U.S. Credit Secrets Series Book 6)
eBooks (Godot Press)
School Loans Gone: A Step-by-Step System for Turbo-Charging your Current Income, Saving Thousands in Interest Payments, and Becoming Completley Student Debt Free Years Ahead of Schedule. (Volume 1)
Book (CreateSpace Independent Publishing Platform)