I am planning on taking out some student loans in about two years, by which time I will have good credit. Most places require I have a cosigner as well (because I don't have U.S. citizenship), so I should qualify for a very reasonable interest rate. My question is, should I get a fixed APR or variable? Fixed APRs are a few percentage points higher, which will obviously mean a lot of extra costs while still in school. But variable APRs have an element of uncertainty. If I am approved for a good variable APR initially, what would make my APR go up?
You'll have to read the terms of the loan carefully to understand how your interest rate can change - it will vary from lender to lender, and may even change over time, or between different loan products. Most lenders will set their variable rate as a fixed percentage + the prime rate, but how often they will adjust it, and how high your rate can go is totally dependent on the terms of the loan.