<prompt> Human: Hi all! My little brother is going to college and needs to take out loans to pay for it. Here is the situation:EXPENSESTotal Tuition, Room and Board, and mandatory fees: 37,992PERSONAL MONEYBrother will pay out of pocket: 5,000Parents will pay out of pocket: 5,000AIDScholarship: 15,000Direct Stafford Loan: 5,505Perkins Loan: 0So after all out of pocket money is applied and his scholarship is applied he still has to pay 12,992. Our question is, what is the best way to go about borrowing this money?The school offered him a direct Stafford loan for 5,505 with a 4.21 interest rate. Should he definitely accept this? Or not? I was clueless when I went about taking out loans to fund my own education and I believe that a lot of my federal loans had higher interest rates then my private loans so I am really not sure what to tell him to do at this point...Also, what is the best way to go about finding a loan for the remaining 7,367 if he does accept the federal loan? Or the full 12,992 if he does not?Also, just as a side note, next few years he is only planning on taking out 2,000 or so because he will not have to live with campus he will live rent free at a family members house. Im trying to help him go about this in a smarter way then I did but after hours of researching Im still not sure what the best way to do this is.Any advice or tips is GREATLY appreciated. Thanks so much in advance.  <response>: He should exhaust every possible option private scholarships through family or professional organizations? first generation college student? grants? etc before hamstringing his future self with student loans. I second the person in this thread who recommended going to community college for two years. Nobody truly cares where your degree came from as long as it isnt University of Phoenix. 37,000 for the first year is almost guaranteed to not be worth it. That said, here is what has been my experience about the loans. Federal loans are generally a better deal than private loans -- they tend to have lower interest rates 4.21 is pretty good I believe, most of mine are 6.8 and they offer more flexible arrangements as far as repayment, defermentforbearance, and eventually, forgiveness. If you make your payments on schedule for a certain number of years and a balance remains, it will be written off, though still counted as taxable income except under public service loan forgiveness. They also go away if the borrower dies. 