Student loans are more essential now than ever. Here’s how to navigate your options.
With the COVID-19 pandemic sending the world into a state of economic turmoil, there’s more pressure on students than ever before. Cash is increasingly hard to come by, and so are the jobs that might otherwise help fund your education. As a result, more students are considering their student loan options.
The good news is that there are some great deals out there if you know where to look. Unfortunately, for a lot of budding students, the market is so overwhelming and cluttered right now, that it can be difficult to navigate your opportunities.
But not to worry. We’re going to give you some easy insights into how you can navigate the student loan issue.
Start with Your Own Finances
Discovering the right student loan option for you begins with research. The first step is to take a good look at your budget. Before exploring possible student loan options, you need to know whether you’ll be able to put any of your own savings and/or earnings towards the educational expenses you’ll be incurring. Knowing on your budget will help you determine the size of the student loan you’ll need.
Your budget will also provide insight how on much you’ll be able to repay monthly when your degree is over and you’re working at getting rid of your student debt.
When you’re checking out your finances, make sure that you have a general idea of how much your education is going to cost. Take into account the cost of everything from tutoring to accommodation, depending on your situation.
Review and Compare Private Student Loan Options
Private student loans could be the right option for you if you’re thinking of going to outside lenders, like banks.
You’ll need to begin by deciding who’s going to be borrowing the cash. If it’s you, then you may need to get a cosigner. On the other hand, if your parents will be paying for the loan, then a cosigner is likely not needed.
Depending on your age, and how much you want to borrow, there are plenty of private lending opportunities out there, and many repayment options to consider too. For instance, you could decide to start making repayments once the loan has been dispersed, or use interest-only payments to handle your expenses during a difficult time in your life.
Doing your research is crucial here, because the rates you can access will vary depending on your credit history and the kind of student loan you choose.
Don’t just go for the first private loan you see. Take the time to compare your rates with the available tools online. This will help ensure that you’re getting the best deal for the finances that you need. Just make sure that you’re comparing your loans like-for-like.
Don’t Forget About Federal Student Loans
Federal loans are usually the first place students turn when financing their education. The rates are typically lower with this kind of student loan, and you get a lot of generosity from the right providers.
Your university will determine how much of a loan you’re eligible for each year, but there are borrowing limits to consider too. If you have a lot of expenses to consider, theses subsidized loan limits could make it more difficult to get the full funding you need.
Subsidized federal loans mean that the Department of Education will pay the interest on what you borrow when you’re in school.
Unsubsidized loans are also available to graduate and undergraduate students that don’t have an obvious financial need.
Work with Your Lender and Consider Alternatives
As lending for student education becomes more common and necessary in the months and years ahead, today’s lenders are likely to grow increasingly flexible. It’s important to make sure that you consider all of your options carefully before you begin borrowing.
Remember, you can also consider alternative loan options like Direct Plus loans, where your parents help to fund your education. These can be a helpful option for parents that are looking to help younger students get the support they need.
You could also think about turning to your family for extra support in the form of cash gifts. Alternatively, you could decide to get a part-time job so that you can help to fund your loan yourself, without having to borrow as much.
About John Hopkins
John is an enthusiastic learner — anything from business and marketing to lifestyle and traveling falls under the list of his interests. John enjoys discovering new topics, exploring new spheres, and sharing his experiences and thoughts with his readers. He is highly motivated by the idea of making the world better with knowledge and experience.