There is still plenty of debate in the news right now about how the current credit troubles will affect those of us with student debt. Most of us though, students and grads alike, are already starting to feel the pinch. This is causing many people to seek out and create new ways to fund higher education. Check out this article from Business Week. It may have you rethinking your approach to private student loans.

As you get closer to graduation, student loan repayment is likely one of the many things beginning to weigh on your mind. Happily, with most all student loans, you still have time to plan. Loans borrowed through the federal FFEL or direct Stafford programs allow the borrower a six month grace period after graduation before repayment begins. Other loans such as a Federal Perkins loan, or an alternative loan you may have received outside of any federal or state program, may have different lengths of time for which they are deferred after graduation. It’s best to speak to your lender or financial aid adviser to get all the details on these. The grace periods allowed to student borrowers after graduation allow you to take some time to secure your income, and put your after-college financial life in order. Rather than continuing to put repayment on the back burner, this is also an opportunity for you to make sure you will be able to make those payments when they come due.

If you are considering student loans and have bad credit, or no credit, it is important to remember that you do have options. First, make sure you have submitted a FAFSA application, and applied for all the grants and scholarships you can find, to minimize the amount you will need to borrow as much as possible. After that, the Stafford student loans offered through by the federal government do not require a credit check. These loans are guaranteed by agencies working with the government and lender banks. So unless you have recently declared bankruptcy, chances are you will not be denied these loans based on your financial history.

Where creditworthiness really comes in to play is when applying for additional loans on top of any Stafford loans you may be offered. Parent PLUS loans, also offered through a federal program, require sufficient credit history on the part of the student’s parent who applies for the loan. Students who apply for alternative student loans with banks or other independent institutions will also need good credit to qualify. Different lenders will have their own terms and conditions for the loans they offer, and many are willing to accept cosigners for students whose credit isn’t up to par. Other loans offered through federal, state, or institutional programs may or may not include a favorable credit score as a requirement. So, be sure to speak to your financial aid adviser about these, and get the facts about credit requirements for any loan before you decide whether or not to apply.

If you’ve graduated recently, or are in your final semesters, it may be time for you to start thinking about student loan repayment. One of the most basic things to remember for those who have borrowed money through the Federal Stafford Student Loan program is that you have options for the way in which your repayment takes place. Student loans are typically set up on a ten-year repayment program, with a set minimum payment due every month. However, you may also qualify for a graduated or income-sensitive repayment plan. A graduated plan starts with relatively small minimum payment which is scheduled to increase over time. Income-sensitive payment plans adjust the minimum payment based on how much money you are making at the time. These options are written in to the federal regulations that govern Stafford loan repayment, and can be great for graduates who are unsure about how much money they will be making as they begin their careers. If you choose to take out a consolidation loan, your options may change. So be sure to speak with your school’s financial aid advisor and a representative of your lender bank before deciding how to go forward with your loan repayment.

Some of the country’s top universities are now offering grants in financial aid packages instead of loans. Some of these colleges are private schools with hefty price tags such as Harvard and Duke.

One notable example is University of Pennsylvania whose plan, according to the Boston Globe, includes:

Expanding existing no-loan policy for low- and lower-middle income families to eventually include all undergraduates. Start date: Fall 2008, for families with incomes under $100,000. Fall 2009: For all income levels.

Students who accept grants rather than loans will have an advantage when they graduate since they will not be burdened with as much debt.