The Complete Guide to Applying for Student Loans
Student loans can help you pay for college, but there is a lot you need to know before deciding to borrow.
How to Reduce What You Need to Borrow
Student loans must be repaid, with interest. This means before you borrow one dollar, you should use other resources. Apply for scholarships and grants and consider choosing a more affordable school. Keep costs as low as possible during college and work a part-time job, if you can. There are many ways to even get free tuition – such as employer-paid tuition assistance, working at a college that offers free tuition for employees, and even going to colleges and cities that offer free tuition.
- How to Minimize Student Loan Debt
- These Companies Will Help You Pay for College
- How to Borrow Student Loans Responsibly
- How Much Student Loan Debt Is Too Much?
- What Happens When You Borrow Too Much Money for College?
Student Loan Basics
Before you borrow student loans, you should completely understand what is required, how the process works, and how student loans will impact you down the road.
- How Do Student Loans Work?
- What are Origination Fees?
- Annual and Aggregate Student Loan Limits
- Which are the best student loans?
- Are Student Loans Good Debt or Bad Debt?
- What’s the Difference between Subsidized and Unsubsidized Student Loans?
- How Much Does a Student Loan Cost?
Our Loan Comparison Calculator lets you compare two or more different loans, identifying which loan offers a lower monthly payment and which one offers a lower total cost.
Our Loan Calculator can help determine the monthly loan payment and total payments on your student loans, auto loans and mortgages, based on the loan amount, interest rate, loan fees and repayment term.
Student Loan Interest
All student loans – both federal and private – will have an interest rate. This means not only are you paying back the total amount you borrowed, but you are also paying back an additional percentage.
The interest rate for federal student loans is set every year and is the same for all undergraduate borrowers, regardless of your credit history. Interest rates for federal loans are always fixed, which means they will stay the same for the total life of the loan.
The interest rate for private student loans differs per borrower. The interest rate depends on the current rate offered as well as your credit history (and your cosigner’s credit history). The interest rate on private loans can be fixed (staying the same) or variable, which means the interest rate can go up or down as often as every month.
- How Student Loan Interest Works
- How to Cut Student Loan Interest Rates
- What is Capitalized Interest?
- Fixed vs. Variable Interest Rate Student Loans
Student Loans and Credit
Credit and student loans are very related. If you are borrowing private student loans, your credit will be factored in during the application process. Your credit will also determine your interest rate. Having student loan debt will impact your credit. Student loan debt increases your debt-to-income ratio, which is determined when you apply to rent an apartment or when you apply for a mortgage. If you miss student loan payments after repayment begins, your credit will also be negatively impacted.
- How to Get a Student Loan with Bad Credit
- Does My Credit Score Impact My Student Loan Interest Rate?
- Do Student Loans Build Your Credit?
- How Do Student Loans Affect Your Credit Scores?
How to Apply for Student Loans
Federal student loans are funded by the government and are a better option than private loans since they offer many benefits.
To apply for federal student loans, you start by filling out the Free Application for Federal Student Aid, or better known as the FAFSA. You can file online.
Filing out the FAFSA also gives you the possibility of qualifying for grants as well as the option to participate in a work-study program.
Undergraduate federal student loans don’t require a cosigner or a credit check.
Applying for a private student loan is completely different than applying for federal loans. Private student loans are funded by banks and other financial institutions. You do not need to fill out the FAFSA to apply for private loans. Instead, private loans are based on your credit. Most private borrowers are not approved without a cosigner due to a limited credit history.
- How to Apply for Student Loans – Both Federal and Private Student Loans
- When Can You Apply for a Student Loan?
- Do You Need Good Credit to Get a Student Loan?
- How to Get Student Loans Without a Cosigner
- The Most Common Mistakes When Borrowing Student Loans
Federal Student Loans
Federal loans are generally preferred over private student loans because there are many benefits – the potential for student loan forgiveness, an option to make payments based on your income, more options to temporarily pause payments if you lose your job, and the possibility of subsidized loans (where interest does not accrue during payment pauses).
- How Do I Get a Federal Student Loan?
- Federal Student Loans Provide Superior Benefits
- What are Federal Stafford Loans – How to Apply and How They Work
- Everything you need to know about the Federal Stafford Loan
- Differences between federal student loans and private student loans
- What Credit Score Do I Need for Federal Student Loans?
- Reasons You Could Get Denied for a Federal Student Loan
Private Student Loans
When a borrower exhausts their college savings and they reach their federal student loan limits, they may turn to private student loans to help fund college.
- What is a Private Student Loan?
- How Do I Choose a Private Student Loan Lender?
- What Credit Score Do I Need for Private Student Loans?
- Reasons You Could Get Denied for a Private Student Loan
- What Is Required for Private Student Loans?
What Can You Use Student Loans For?
There is much more than tuition to pay for in college. Student loans should only be used for necessary expenses. That means don’t use your student loans for nights out with friends, vacations, gadgets and a new wardrobe. Here are some commonly asked questions on whether or not you can use student loans to pay for something.
- What Can I Pay for with Student Loan Money?
- Can I Use Student Loans to Pay for Rent?
- Can I Use Student Loans for Summer Classes?
- Can I Use Student Loans to Pay for Trade School?
- Can I Use Student Loans to Buy Health Insurance?
- Can I Use Student Loans to Buy a Car?
- Can I Use Student Loans to Buy a Computer?