Getting a student loan is a risky decision because it is difficult to cancel. You might end up spending your whole life pay back loan debt. Though education is seen as a worthy investment, a lot of people regret taking out student loans. We will be putting you easy steps to get your loan. Also vital questions you will need to answer honestly.
There are ways to apply and get your school loan which reduces the burden of endless research. These simple steps will be outlined here. And if followed to the letter, then getting the loan you want should not be a problem.
Calculate The Size of The Loan You Need
Before you take out a student loan, you need to be sure that it is your last resort. Other options to school loans include school loans from family and friends and credit cards. The next step is to find out the size of loan you will need.
Here you will need to come up with a budget. This is important so you don’t borrow outside what you need. In order to reduce the amount, you have to borrow you can decide to take a part-time job. You can also decide to apply for a grant. Every penny is important so you don’t have debt you can pay back.
Choose The Type of Loan That Suits You
Anyone who seeks financial assistance to attend college or high school can get it. There are basically 2 types of school loans namely which are government student loans and private student loans.
An example of the government student loans is the Stafford student loan. This type of loan has a fixed interest rate and guaranteed by the federal government. A lot of people see Stafford loan is the best choice. Especially if you haven’t taken out a loan before.
Private student loans have a higher interest rate and should only be looked at if the government loan is not enough to cover for tuition. There are so many private student loans offers out there. Be sure to select the one with the best interest rate and a flexible student loan payment plan.
What Can I Afford?
When taking out a student loan, there are fundamental questions which need to be answered. These questions help you make the right decision when it comes to borrowing to fund your education. We will be listing these questions out. Ask yourself;
- Are my parent willing to contribute to your education? And how much are they willing to put in?
- Do I have a saving? And how much of my savings am I putting down?
- Am I willing to work while in college? And how much is the income after tax?
- Have I received any financial aid from scholarships and grants I applied for? How much is the total?
- What is my student loan limit for both my government student loans and private student loan?
Answering these questions honestly will show you the next steps to follow. If you have to choose between borrowing to attend an ivy league school and attending a state college, you are advised to choose the state college. This is because you remain debt free until you decide to take out a loan.
How To Get Government Student Loans
Getting a government loan is seen as the better option for students. This is because of the low-interest rate and flexible student loan repayment plan. To get a government loan, all you have to do is follow the steps outlined below.
- The first thing you will need to do is let your school authority know that you will like to take out a government loan. This authority is usually the financial officer of the school. They will take you through the steps to apply.
- Next is to fill a FAFSA form. The details needed have to be the financial information for both you and your parents.
- If you are eligible and your offer is granted, you get loan offer from your school. Should you decide that this is the best option for you can accept it. If not, you can decline the offer. It’s up to you.
- Accepting the loan means you have decided to take on a loan entrance counseling session. This educates you on how a loan works.
Once you have completed the above steps successfully, then your student loan is ready to use. You just have to sign a loan agreement and you can have access to the funds.