If you’ve decided to further your education, but don’t have a college fund, you may find yourself worrying about how to pay for it. Scholarships are great, but not everyone qualifies for them. If you’ve decided to borrow money to bankroll your future, you have options of how to go about that.
Gather it Up
Institutions that are considering giving out borrowed money are going to want a lot of personal information, so it’s best to have that handy before you start. You’ll need the basics like your social security number and address, but you’ll also need to know how much you spend on rent and verification of your income. If you live with your parents, you may need their info too.
FAFSA
Once you have all your information together, fill out the Free Application for Federal Student Aid, or FAFSA form to see what your options are. There may be some free federal dollars in the form of grants available to you. This process will also determine the type of federal student loan you qualify for. Studentaid.gov explains how these loans differ from private loans, “Federal student loans are made by the government, with terms and conditions that are set by law, and include many benefits (such as fixed interest rates and income-driven repayment plans) not typically offered with private loans.”
Private Loans
If the FAFSA has determined that grants and federal loans won’t cover your needs, private loans may be for you. NerdWallet has compiled a current list of the 7 best private student loan lenders, even outlining what type of borrower each loan is best suited for. They also advise, “If you have no income and either no credit or bad credit, you’ll need a co-signer to get a private student loan. Without bills in your name, such as a credit card, car loan or utility, you have no way to demonstrate that you can pay bills on time. Your co-signer will need to have a steady income as well as good to excellent credit scores, typically at least in the high 600s. Signing with a co-signer means they’re on the hook for your loan bill if you can’t pay.” If you have a trusted bank or credit union, it is a good idea to make an appointment to go in and speak to a loan officer about their student loan options.
College is an investment in your own future, spend wisely.