Paying for College

Unfortunately, many students don’t have access to the right information and counselling that they need in order to make the right decisions about how to pay for college.  Here is some quick advice to those of you out there who are thinking about a private student loan.

Be sure that you have completely exhausted all other financial aid options.  Private student loans should be used only as a last resort.  Consider looking into federal Pell grants, federal student loans such as Stafford, Perkins, and Grad PLUS.  Always look for scholarships and be willing to accept work-study as well. Private student loans usually carry higher interest rates and have less options for repayment.

Figure out exactly how much money you will need to go to college.  Financial Aid is based on an award letter which is equal to the cost of attendance minus and sources of financial aid.  Once you know this number, you will be able to make better decisions about how to pay for it.

Find yourself a creditworthy co-signer.  The lending world is now largely requiring that as a person with little or no credit history, you will need someone to cosign the loan with you.  The better their credit, the lower your rate will be and the more likely it will be that you are approved.  Find the person before it gets to be crunch-time.

FInally, ask your schools financial aid office who they recommend.  Every school should have preferred lenders and thanks to crackdowns, they should be the best products available.  Once you have the list, do some research for yourself.

College loans are the first of many extremely important decisions you will face as you head out into the world.  Understand what you are getting yourself into and be prepared for what lies ahead.  Good Luck.