Paying for College with Loans
If grants and scholarships don’t come through, don’t give up on your education. There are always student loans. Don’t be afraid of having to borrow money in order to get your degree—student loans have lower interest rates and kinder repayment plans than almost any other loan you’ll ever have to take out in your life, and getting a college degree means that you’re much more likely to get the kind of job that will make paying your debts off an attainable goal.
What kind of student loans are there?
There are really three kinds of student loans. Federal loans, bank loans, and private loans. Any of these can be distributed either to students, or parents of students. Sometimes the interest rate and repayment changes if the loans are distributed to parents, but this depends on the organization giving the loan, so make sure you read the fine print. Also make sure to note whether the interest rate you’re signing on to is fixed or changeable. Sometimes you can opt in to fix your rate (keep it the same) but it’s not always an automatic thing, which means that your lender could raise it on you. Again, read the fine print!
Can you use student loans for online universities?
Student loans can be used for any accredited university, and that includes online degrees! Just make sure that your online university is legit.
How much can you get with a student loan?
Really, you can cover your entire tuition with a student loan. That’s probably not the best option, though, because even with lower interest rates than other loans, you’re going to have to pay all of that money back and then some. Student loans are great for the costs you can’t cover with grants, scholarships, or your own bank account, though.
What’s the general application process?
Firstly, you must be enrolled in an accredited college, university, or trade school in order to take out a student loan. For federal loans, you must fill out your FAFSA in order to qualify. For private and bank loans, you must fill out an application form, which the lender will review and decide how much they’re willing to lend based on your information. After that, you must sign the necessary papers ensuring you’re willing to pay the loan back. With bank or private loans, you can apply with a cosigner (like a parent or someone else who has a specified income) which may help you qualify for much larger sums than if you apply on your own.
Do I Have to Have Perfect Grades?
Lenders don’t care what kind of grades you have. As long as you’re willing to pay back your loans, they’re willing to help you further your education.
Do you have to be fresh out of high school?
Again, lenders don’t care whether you’re 18 or 80 when you’re taking out a student loan. If you’re enrolled in a higher education facility, you’re eligible for student loans, so non-traditional students need not worry. In fact, private loans may be easier to come by if you already have a job with a decent income.
Can you apply for more than one student loan?
You can certainly apply for more than one student loan, and in fact to cover costs you may have to—just make sure that you keep all your loans organized and know what you owe to whom. Many student loans don’t need to be repaid until after you’ve finished school, but some private loans may be different. Make sure you read all the fine print.
What is loan consolidation, and important is it to consolidate your loans?
Consolidating loans means that you take multiple loans and basically hand them over to one company, so that you end up making one payment for all of your loans (per month, etc.) instead of payments for each of your separate loans. Consolidation can be a very good idea, as it can mean that you pay off your loans quicker, but it can also come with higher interest rates, so this one you have to judge on your own. Check out different consolidator companies, and make sure that your loans are eligible to be consolidated in the first place.
And if this all overwhelms you a bit, ask for help! Your financial aid office is there for a reason, don’t be afraid to let them do their job.
