In-state tuition fees exceeded $7,000 for students attending state universities during the 2010 to 2011 academic year, according to the College Board's Trends in College Pricing 2010 report. Students paying out-of-state or private-school tuition faced even higher fees. Student loans can help offset these tuition expenses, but you need to know where to look to find financial aid. The earlier you start securing loans, the more success you will have in obtaining them.
Federal Loans
The first place most students look for students loans is from the government. Federal Stafford loans help fund college educations for millions of students nationwide every year. Students borrow money from the U.S. Department of Education to go toward their tuition at a four-year college or university, two-year college or technical or trade school. Two types of Stafford loans are available. Direct subsidized loans go to students with a demonstrated financial need, as verified by their school. Direct unsubsidized loans are available to students who want a loan but do not have a financial need for one.
FAFSA
Receiving a Stafford loan begins by filling out a Free Application for Federal Student Aid. This application details your basic biographical information and financial information, which allows your school, with the help of the government, to determine what type of loan -- and how much of a loan -- you qualify for. The FAFSA takes into account a family's financial situation, so your parents' income(s) can impact the amount of federal student loans you will receive.
Timeline
Students should complete their FAFSA as soon as they can to maximize the amount of student loans they receive. You can file the FAFSA starting on Jan. 1 of each year for the following academic year, which usually begins in the fall. The College Board recommends completing the form as close to the beginning of the year as you can. Get a jump start on your FAFSA by collecting as much financial information as you can before the Jan. 1 start date. This will make completing the FAFSA easier.
Private Loans
Students can also opt for loans from private financial institutions. If you do not complete the FAFSA on time -- or do not qualify for any federal loans -- then private loans are your best bet. The disadvantage to private loans is that the interest rates are more variable and generally higher than student loans, which can impact the amount of money you owe when you graduate. However, several lenders, including banks like Chase and Fifth Third, offer student loans. Check with local financial institutions for your student loan options.
Tags: student loans, academic year, College Board, financial information, financial institutions