Madison
How do you pay for college through loans and how do your parents help?
#college #help #graduate #financial-aid #money
3 answers
Taj Jones
Taj’s Answer
Hi Madison,
Excellent question!
There are two traditional college loan routes for students - federal loans and private loans.
Many have heard of the federally-backed Stafford Loans (Subsidized and Unsubsidized). These are available for those who qualify after completing the Free Application for Federal Student Aid (FAFSA). These will almost always have lower interest rates than private loans, and they generally have better repayment options. However, they accrue interest and will have to be repaid via certain timelines and conditions. The Parent PLUS Loan is available to parents who qualify who are credit-eligible. And unlike the Stafford Loans which remain in the student's name (although other parties can contribute in paying off these loans), Parent PLUS Loans will remain in the parent's name who gets approved for it.
There is also the Federal Perkins Loan, but this has been phased out at many colleges.
On the other hand, you have private loans. These usually are credit-based - meaning you will need to have good enough credit to qualify or have a co-signer who can qualify. They have varying repayment terms and interest rates. Sources of these types of loans are banks and credit institutions, and they usually can be applied for at those places.
Great answer!
Jacqueline Se'Ale
Clarissa Escamilla
Clarissa’s Answer
When you’re figuring out how much to take out, create a budget. Calculate what you need for tuition, living expenses (electricity, food, etc), and housing. If you aren’t sure how much you need to live off of, you can talk to people around you to get a feel for how much they pay for utilities and food every month. If you have a job, subtract what you need from your pay and if you still need more money look into loans. Your parents Can help with either a parent plus loan or as a co-signer.
Always, always, always fill out the FAFSA, some schools have tuition scholarships and they use the FAFSA info to divvy them out. For me, the FAFSA loans were a lot easier to pay back.
Clarissa Escamilla
Clarissa’s Answer
When you’re figuring out how much to take out, create a budget. Calculate what you need for tuition, living expenses (electricity, food, etc), and housing. If you aren’t sure how much you need to live off of, you can talk to people around you to get a feel for how much they pay for utilities and food every month. If you have a job, subtract what you need from your pay and if you still need more money look into loans. Your parents can help with either a parent plus loan or as a co-signer.
Always, always, always fill out the FAFSA, some schools have tuition scholarships and they use the FAFSA info to divvy them out. For me, the FAFSA loans were a lot easier to pay back.