<p>Please excuse my lack of knowledge on the subject, but do you have to put up collateral on a student loan like on a house loan?</p>
<p>No-- not generally. You’re probably talking about the federally subsidized student loans. They’re backed by the government, so there’s not a collateral issue.</p>
<p>There might be some private loans out there that have other requirements. I’d avoid them.</p>
<p>The parent’s PLUS loans do require a good credit record, though.</p>
<p>That’s interesting…so if a student goes bankrupt, the government will cover? I guess the governement is good for some things…;)</p>
<p>Student loans aren’t ordinarily dischargable through bankruptcy, unless there is a showing of ‘undue hardship’.</p>
<p>But if the student doesn’t pay, the government will cover the loss. Then the government will go after the student, forever. Even post-bankruptcy.</p>
<p>Student loans are considered to be very safe because government will make sure you pay them, even if they have to withold your salary or SS checks or won’t let you to go to grad school etc.</p>
<p>Student loan interest rates are also generally lower than home loan interest rates, correct?</p>