College, it’s said, is often the best four years of a person’s life. It is definitely the most expensive four years for most individuals. With very high-interest rates on loans and rising college tuition, it seems almost impossible for someone to come out of college debt free. There are several things that one must keep in mind when they begin looking for assistance for college funding.
Three tips to remember are: Borrow as little as possible, don’t use co-signers, and try to utilize federal loans and grants first. Borrowing as little as possible is the first thing all students try to do. When coming out of college, it is very alarming to discover how quickly that final number added up. By utilizing the federal grants, one does not have to pay any amount of this grant back. Use as many and as much of these as you are granted. Students often have hard times getting approved for loans for college, but going through federal loan systems is much easier than going private. Private loans have much higher interest rates and often require a cosigner. It’s difficult for a beginning college student to receive any type of loan without a cosigner due to lack of credit. However, it is best to avoid any future loan defaulting, and finger pointing by simply getting loans with only the student’s name on it. When students get loans from the government, it is often much easier to get flexible repayment options for individuals who have fixed incomes or low incomes.
If a student is able to make payments on loans while they are in school, it is best for them to do so instead of paying on student loan interest. Taking out fewer loans to pay for school while in school is the best choice possible. Once out of school, it is always best to pay for the loans that have the higher interest rates first. Other ways to save are sending kids to local community colleges to do prerequisites and early degree work before heading off to a pricey four-year university or college. While applying for loans, it is best to get the FAFSA completed as early as possible, this will solidify the changes that students are getting the highest amount of aid the college/university will allow them to receive.
If you are having difficulties getting answers to your questions, having difficulty making payments and are not receiving any assistance from your loan provider, you are able to file a student loan complaint with the CEFB or by calling 1-855-411-2372.
Adapted from an article in the business section of the Cleveland Plain Dealer from August 31, 2014.