QUICK FACTS YOU NEED TO KNOW ABOUT GETTING A
Student Education Loan
Starting your college career can be an exciting but confusing time. You’re leaving home and leaping into an entire new world, full of opportunities and new challenges. Financing your higher education can seem like a confusing task. We’ll work hard here to clarify the student education loan options available, so you can make more informed decisions on paying for your college education.
Begin with Scholarships and Grants
Of course, scholarships and grants should always be your first options for financing your education. After you’ve completed your Free Application for Federal Student Aid (FAFSA), you should begin to receive award letters from schools you selected. These award letters vary in makeup, but will generally give you information about scholarships, grants, work-study options, etc. Take advantage of these first, and also don’t forget to do your own research – it’s possible that there may be another education funding option available to you that’s not listed on the award letter.
Then Consider a Student Education Loan
What are Federal Student Loans?
A Federal student loan should be your first choice, because they offer low, fixed interest rates, which will keep the amount of interest charges you pay back to a minimum, and they don’t require a credit check. Because these education loans are backed by the U.S. government, there is no co-signer required. Plus, you won’t have to pay back a penny on the loan until at least six months after you graduate, drop below the level of a half-time student, or leave school. After this time, monthly loan payments begin as low as $50 per month.
A federal student education loan generally allows 10 to 25 years of time for repayment after their grace period, depending upon which repayment plan you choose. You can also switch to a different loan repayment plan if your needs change over time. Read more about Federal Student Loans.
Private Student Loans
When other options aren’t enough, consider a private student education loan, available from various lending institutions. Although private student loans generally have higher, variable interest rates, they can be a great source of additional funding, and you may find that a particular company offers a current variable interest rate that is actually lower than what is offered through a federal student loan. Private student loans may offer some of the same benefits as federal student loans, such as not having to make payments until you’re out of school for a few months, or drop below half-time student. Other private student education loans may require small payments while in school, such as interest-only payments. Read more about Private Student Loans.
Education Loan Consolidation
If you have several student loans, you may want to consider student education loan consolidation. Student loan consolidation can have several benefits, such as only having to make one monthly payment, and the ability to stretch the repayment period out much farther. Depending upon the details of the consolidation loan you choose, you may even be able to lower the total amount you pay each month. Read more about Education Loan Consolidation.
Do Your Homework
Whatever paths you choose to take towards financing your higher education, remember to research as much as you can, so you can make more informed decisions about your options. Take into consideration the wide range of tuition costs from one school to the next. Consider the cost of living in the various cities where you may attend school. Consider living at home and commuting to school – it’s been estimated that this alone could save the average student about $6,000 per year. The bottom line is this: even though there are some tasks you can’t complete until the year you’ll begin school, there are many things you can begin to research years ahead of time. This way, you won’t feel so overwhelmed the year you’re about to start college.
Try to remember that financing your college education isn't always about how much money you can get... it's also about how much money you can save. For instance, the car you'll drive while in school doesn't necessarily have to be new, it just has to be dependable. Instead of hitting the town both Friday and Saturday nights, plan a 'game night' on one of these nights. There are lots of ways that you can save a little money here and there, and still have a great time during your college years. And saving that money will translate into less money stress for you, both during your college years, and after, when you're paying off those loans.
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