Continuing one’s education after high school can be very costly. Choosing a college to attend is one of the most important choices you will ever have to make. Most colleges offer students loans, but before taking on a loan research the following:
- Student loans
- Private loans
- Tuition rates
- Admission rates
- Services available
A student loan is provided to students to help them with their educational costs, textbooks, tuition, and living expenses. Most of these loans have low interest rates and generally will not ask for any payments until after graduation. Look at all the options that are available, because this is one of the most important decisions the student will have to make; this is where their future begins so don’t be in a rush. Get some feedback, ask around, visit some colleges, look at the courses and majors they have to offer. What licenses are offered (degrees, certificates), look at the school rates, ask some of the students that are attending, what is the percentage of students that get a job after graduating? What services are offered to the students? Do they offer job placement? Look at the classroom ratios, course availability, educational program, online and on-campus programs, where is the school located? Is it convenient for them? As you can see you need a great deal of information before making a decision, so do the research.
Before you decide to get a student loan, find out if what is required to apply for any grants and scholarships that are available; this is actually free money with the exception of grants. Grant money could be required to be paid back only if the student drops out of school or grades are extremely low. There are several loans that are available to college students, but the main two are the federal loan and private loans. Federal student loans come from the government and offer lower interest rates and provide different options to repay your loan. Private student loans have higher interest rates, are based on the student’s credit history, may also require a co-signer, and are offered by banks, like Wells Fargo or Sallie Mae.
There are also some words that the student should become familiar with in order to make a decision about what loan to take:
- FAFSA – (free application for federal student aid)
- Subsidized – money that is given to a student who has applied for financial aid; provided by the U.S. Department of Education
- Unsubsidized – when interest goes up throughout the schooling period and after graduation, it is added to the loan
- Grace period – 6-9 months that are given to students after they graduate to start paying off the loan
- APR – (annual percentage rate) the percentage that is owed for borrowing money (loan)
- Repayment plan – an agreement between the borrower and the lender about how much and when payments will be made
Take into consideration all these tips before signing a student loan. Research and gather as much information as possible before coming to a decision.