• Your one stop for college news and resources!

Applying for a Student Loan: Where Should You Begin?

As the cost to attend college keeps rising, so does the need for students to find ways to cover that cost. Savings, grants, and scholarships are often not enough to pay for college, leaving a student loan as one of the primary options to finance the education you want. As you consider student loans, It’s important to know that not all student loans are the same. Before you decide to jump in with student loans, you should consider all of your funding options including grants, scholarships and others.

Private student loans

Private loans, like the name implies, are provided by lenders like banks and credit unions, as opposed to federal student loans, which are funded by the federal government. While there are a lot of benefits to getting a federal student loan, there is a maximum limit of how much you can borrow. You should start by utilizing federal student loans if you can, but with the rising cost of college, federal loans may not be enough. Private student loans can help fill this gap.

Give me some credit

Federal loans don’t require a credit check, which means when you apply for one, you’ll get the same rate as every other student. When applying for a private student loan, your unique financial circumstances and credit history are taken into consideration, which can affect your approval odds and the interest rate offered if you are approved.  While having to pass a credit check may seem like a disadvantage, private loans commonly give you the option of having a cosigner. With the right cosigner, it could make a big difference in the rates you’re able to receive and may make it easier for you to acquire a private loan with a good rate. After you graduate, you may have the option to refinance your loans using your improved and established credit, which could offer you the benefit of a lower rate.

Shop around!

Where should you begin? Student lending platforms like LendKey can help you find a private student loan to cover your cost of college.

What’s the difference?

The rates and terms you may be able to get can vary drastically from one lender to another. Taking the time to shop around now could save you thousands of dollars in the future.

Federal students loans always have fixed interest rates, meaning your interest rate will be the same for as long as you have the loan.  With private student loans, you often have the option of choosing between fixed and variable rates.

There’s more to consider than just the interest rates. Will there be reliable customer service?  Will the lender also be the one to service the loan? LendKey services the loans that are originated on its platform, and LendKey’s US-based loan specialists are consistently praised for their friendliness, reliability, and how quickly they are able to respond to questions.

The loan with benefits

If a private student loan fits your needs, LendKey connects community banks and credit unions to students like you. Because LendKey partners with community banks and credit unions, these institutions prosper when their customers prosper, so they want you to succeed. Lendkey also streamlines the lending experience, making it easy to keep up with your loan. You can complete the entire process online, including reviewing your loan, applying, and making payments.

LendKey can also simplify repaying your existing student loans with student loan refinancing once you have graduated. If you have multiple loans already in place, you can combine them into one brand new loan, making it more convenient to keep up with. The greatest benefit  —  one loan means one interest rate, which could save you thousands in interest over the life of the loan.

When you work with LendKey and one of their partner lenders, you have a strong team behind you, helping make your dreams come true.

LendKey was founded in 2009 immediately following the Great Recession. Through partnerships with banks and credit unions, LendKey has helped more than 92,000 borrowers and disbursed more than $2.9 billion in loans.

For more information visit http://www.lendkey.com. 

See Also:

Common Interview Questions & How to Answer Them

Avoid These Interview Mistakes

Writing the Perfect Resume

Are You Scared About Drowning in Debt?

Receiving a college degree is a highly rewarding accomplishment that requires an extensive amount of dedication. And often, a college education awards you with a higher salary than others who lack it. Perhaps, it’s true that you do indeed have to spend money to make money, but with annual tuition expected to increase by an average of 2.4 percent at private colleges and 3.2 percent at public universities, according to StudentDebtRelief.us—the amount of money to be spent requires taking out a lot in loans. The amount of student loan debt varies between public and private universities, leaving undergraduate students from private universities owing, on average, around $7,000 more than their public school graduate counterparts.

With the total national student debt sitting at about $1.5 trillion, some of the 45 million borrowers who collectively owe that amount could be paying off their loans for the next few decades and maybe even longer. Around 2.8 million people who are age 60 and older were still paying off the 66.7 billion dollars of their generation’s debt in 2017.

Types of loans

There are different types of student loans out there for students. Before attending a university, students are encouraged to fill out the Free Application for Federal Student Aid (FAFSA), the document that allows universities to tell their applicants what type of aid they qualify for.

This aid can come in many forms. A direct subsidized loan is often the best option because the U.S. Department of Education will pay the interest while the borrower is still a student and potentially for some time after they graduate. Unsubsidized loans put the responsibility of paying interest on students, who oftentimes aren’t able to pay while they are still in school, allowing their debt to steadily increase while they complete their education.

Another option is a federal student loan, which offers fixed interest rates and favorable repayment terms such as allowing borrowers to pay less when they first start to work. Some also offer extended repayment plans, which include loan forgiveness after the borrower has made, depending on the plan, 20-25 years of payments.

Private loans, with variable and high interest rates that rarely offer repayment plans, are typically only used in the event that the borrower has exhausted their federal loan options and is still in need.

What’s the right choice to avoid less debt?

One of the growing questions surrounding this daunting idea of loan debt is: “What happens if the career I invested money into being educated for doesn’t pay well or worse, isn’t there at all?” Often, it’s less of a question of whether or not to take out loans and more of just figuring out how much is necessary. While the skills obtained from related coursework could be valuable for various other jobs, actual careers available in some fields, such as the postal service, agriculture and journalism are quickly diminishing.

For bachelor students, considering the expected salary of their future career is arguably the biggest factor in their decision of how much to take out in loans. It’s not unlikely for graduates to switch career paths or pursue other, more profitable areas of interest, strictly due to the fear of not being able to make enough money to pay those lenders back.

Graduate student loans

Graduate students have intimidating student loan debt as well. Lindsey Denton, a graduate student at Lincoln Memorial University in Harrogate, Tennessee, began pursuing her Masters of Science in Nursing in January 2019. “My program is a total of 43 hours which comes out to $33,000 for [only] tuition. I am taking out loans to pay for the whole thing [plus] extra to help me pay for living and eating,” Denton said. “Right now, I live rent free, but if not, I would be taking out [about] an extra $15,000 just to pay for rent, not eating or gas or books.”

She has no scholarships. According to 2014 statistics from msnedu.org, “The average salary of experienced MSN-educated nurses in Tennessee can be as high as $168,000.”

That number is more than twice the average salary of Registered Nurses is Eastern Tennessee, which the website has listed as $51,240. In 2015, studies showed that over the last 15 years, the average student loan balance for post baccalaureate certificate completers at public institutions had been 57 percent higher.

For doctorate students, the balance was 64 percent higher for those at public institutions and 107 percent higher for those at nonprofit private institutions.

Other options to lessen your debt

The reality of student loan debt has led many students, both undergraduate and graduate, to seek out more grants and renewable scholarships, neither of which have to be paid back and are always readily available through websites, universities directly and many local businesses. For students who have already accrued student loan debt, some schools, like the University of Central Arkansas, offer free access to use the resources provided by Solutions at ECMC. Their website describes Solutions as “a service of the non-profit organization ECMC and is dedicated to helping students manage educational loans.”

This article was originally published in the spring 2019 edition of College News.

See Also: 

College Life Hack: Earn Extra Money on the Side
College Scholarships: Get the Funding Facts
Applying For A Post-Graduate Degree

College Scholarships: Get the Funding Facts

Studying alone to achieve the perfect GPA for your dream college is daunting enough as it is and then comes the other question of covering your tuition fees. College News have teamed up with the COO and Co-Founder of OneClass, Kevin Wu, to spill the tea on the different types of scholarships, the best student resources, interview tips and most importantly the secondary perks of scholarships.

What steps can students make to help reduce the costs of attending college?

Don’t limit your search to scholarships, bursaries and grants provided by your school. There are countless available that you can find on the web and the only cost to you is your time. Make sure to perform well academically so that you’re presented with greater scholarship opportunities as you move along college.

While in school, search for side-hustles that don’t require regimented time commitments. That is, jobs that grant you a flexible schedule. Jobs like driving around for Uber, Lyft, becoming a note-taker. You don’t want to place yourself in a position where a job takes precedence over your studies.

What different categories of scholarships are available to students?

There are enough categories of scholarships to run the gamut of possible student segment in college. Of course you can always find scholarships in the primary categories: needs-based, merit-based, school-based etc., but you can also find scholarships for athletes to scholarships for those pursuing studies in a field related to the grocery industry. There is no shortage of scholarships available.

Are there any scholarships that cover the entire cost of tuition fees?

There are scholarships that cover the full tuition of a student for a year; some even cover the tuition for all four years in college. The Cameron Impact Scholarship is one of them. Keep in mind, however, these are the most sought after scholarships, so competition will be high. They’re also commonly rewarded to the most academically driven students that are able to tie academics with extra-curricular activities while maintaining top-of-class credentials.

What are the perks of an athletic scholarship?

College athletes awarded with athletic scholarships commonly enjoy partial to full tuition coverage. The benefits don’t stop there: meal stipends, room and board coverage, student fees exemptions, physiotherapy coverage and college admissions are lenient for student-athletes in some cases. According to NCAA, more than 150,000 student-athletes receive $2.4 billion in athletic scholarships each year from NCAA member colleges and universities alone.

If you’re not a fan of being on the field, how can an esports scholarship benefit your years at college?

If forfeiting late-night gaming for academic success wasn’t ever in a student’s game plan entering college, it could be a good idea to make the most of your choices by applying for an esports scholarship and lean on some that partially cover your tuition. The average esports scholarship averages $4,800 in tuition awards according to the National Association of Collegiate Esports. As esports continue to grow, scholarship funding will only increase and more scholarship options will become available.

How can students assess the long-term financial impact of different colleges?

Students should seek out a college budget template and fit in expected expenses and extrapolate those figures across all four years to get a clear understanding of how much money that will come out of their pocket by the time they’re done for every school. This will also give them a good idea on how much they will be expected to pay back in student loans. Tuition plus expenses will vary depending on the school and the location of the school, so check with your school’s website to get exact figures.

Is there a limit on how many scholarships you can apply for?

No. There are only two things that can stop an applicant from applying for scholarships: a lack of trying or a desire to do something else. Stay motivated and keep applying because billions of dollars in scholarships are unclaimed every year.

What are your recommendations for keeping track of applied to scholarships?

Keeping track of the scholarships you applied for doesn’t have to be fancy. All you need is a calendar marked with upcoming dates of every deadlines, interviews and announcements after every application. It would be wise to reserve time on your schedule for interview preparations as well.

What are the best resources for finding scholarships that are applicable to you?

The best method of finding suitable scholarships for you are to search for scholarship directories. We put together some of the most well-scholarship directories here.

Do you have any tops tips on preparing for scholarship interviews?

Be mindful of what qualities the scholarship committee is looking for in their scholarship recipient. From there you should wrap the narrative of your biography and accomplishments to be coherently aligned with those qualities. Your presentation should be personal. Don’t be afraid to allow your idiosyncratic qualities shine because scholarship committees like students who naturally embody the highest standards in the qualities they look for.

OneClass incorporates an  extensive library of exam study guides, lecture notes and video tutorials created by top students, thus allowing you to quickly find what you need, when you need it. There’s a reason why 90% of all students who use OneClass get better grades.

Make your student life easier with OneClass. Follow @OneClass on Facebook and Twitter to get all the latest student offers and most effective study tups. 

See Also:

The Dos and Don’ts of College Interviews

Common Interview Questions & How to Answer Them

Applying For A Post Graduate Degree