Attending colleges and going to universities requires funding, which makes knowing how to apply for student loans very important.
For most students, getting private student loans or a federal student aid is the only way to afford a university degree.
Understanding how to apply for student loans and understanding how this may affect your future is equally important.
Follow these steps to pursue your degree through the help of student loans.
How to Apply for Student Loans Guide
1. Calculate Your Cost of Attendance
— Clark Howard (@ClarkHoward) June 9, 2017
The Cost of Attendance is the amount you need to be able to attend college.
This should also include your house rent or lodging fees, books, transportation, personal expenditures, and school fees.
You can visit your preferred university or college website to determine how much a year would cost.
Consider including a small percentage of buffer for unexpected school expenses excluded from your list.
2. Check for Federal Student Aid, Grants, and Scholarships
— Kim Martin (@BrokerKimMartin) June 8, 2017
Private student loans are expensive.
Interest can build up and you might find yourself in deep debt after earning your college diploma.
You might want to try getting financial assistance from grants and scholarships available to your preferred university or by applying for a Federal Student Aid.
You can visit StudentLoans.gov to know more information on how to avail and qualify for a Federal Student Aid.
3. Determine What You Can Afford to Pay
It would be wise to avoid being totally dependent on a student loan to send yourself to college.
You must remember that after graduation you will need to pay for the principal and the accumulated interest on your student loan debt.
How to determine how much financial help you need for your college education:
- Determine your total cost of attendance
- Deduct any amount you or your family can shoulder
- Subtract grants and scholarship aids from your total cost of attendance
Any remaining amount is the amount you should consider acquiring through private student loans.
4. Finding Private Student Loans Lenders
You can avail private student loans from banks, private companies, and other accredited lenders.
The requirements for the application would vary, depending on the institution you pick.
Gather as much information as you can on the plans offered by these different institutions, compute the interest, and look for flexible payment plans. From here, you can decide on where to submit your personal student loan application.
5. Gather Your Financial Information and Other Requirements
— Jean Pickering (@TektiteGroup) June 8, 2017
A cosigner is important and a common requirement when applying for student loans
This is usually a parent or your guardian.
Your personal credit history and that of your cosigner will determine the type of loans you can get.
You also need to gather the following documents for your loan application:
- Social security number
- Income level
- Latest tax information
- Credit history
- Assets and liabilities
- Address and contact numbers
6. Apply Online
Most applications for student loans can be filed online. Submitting documents can be sent through the mail or via an institution’s website.
It will take at least a few minutes to determine if you are eligible for a student loan or not.
However, upon qualifying, a secondary review will be facilitated to determine your eligibility.
Have you received sales calls like this? “Get student loan forgiveness in 2 weeks!” BEWARE. They charge hefty fees & are probably scams. pic.twitter.com/HZrgKQpkfn
— Federal Student Aid (@FAFSA) June 8, 2017
7. Student Loan Release
— Fluid Social Credit (@GetFluidApp) June 17, 2017
You will be required to sign a promissory note prior to the release of your student loan.
This document indicates all the conditions as well as the interest and repayment plans you’ll have to fulfill to repay the loan.
Be very keen on reading this document and take note of any discrepancies or clauses you do not understand. Have a parent or someone knowledgeable help you through the signing process.
Upon approval, the money will be disbursed to your preferred college or university.
There are very rare instances wherein a lender gives the loan directly to the borrower.
On average, it will take around 3 to 10 weeks to process a private student loan and have the money released to your chosen school.
Still confused with how student loans work? This video from How to Adult provides the basic information:
Private student loans are inexpensive, but you can avoid getting into bad debt if you understand how student loan works.
A better understanding of how to apply for a student loan can also land you in a loan that will not hurt your financial health in the future.
Applied for a student loan recently? Share your experience in our comments section.
Avoid bad student debt by making wise financial decisions today. The struggle for student loan repayment is real. Learn more from this article The Struggle for People with Student Loan Debt.