3 Things to Remember When Applying for Student Loans

Oct 15, 2020 by

woman carrying white and green textbook

Going to college is one of the most exciting things anyone can do.  There’s the promise of new milestones, new ideas, and new people that propels us into motion and towards higher education.  Unfortunately, this education isn’t free- it’s not even cheap!  College is becoming one of the most expensive things young Americans face, happening more frequently than buying houses or starting families.

The problems arise when young people who don’t have much of a financial history unwittingly sign on to expensive loans that can wreak havoc on their lives.  

Here are three of the main things to remember when applying for student loans, and to keep in mind as you pay them off.  College is expensive, but that shouldn’t be your only memory of it!

Work To Pay While In College

While you’re working on getting your education, you should take the necessary steps and have a constant income.  This money can be used as saving for when you graduate, but it should also go towards paying off your student debts while you’re still in school.  You can’t accrue interest on your loans while you’re still in school, so that period is the best one for making payments.  

This action will save you a lot of money in the long run, since most college loans have an interest rate between two and sixteen percent.  Just be sure not to overwork yourself; an education is only as good as the amount of information you’re able to absorb.  If you’re overworked, you won’t be able to learn much.

Cosigners Matter

To help keep your interest rates down, work to find a cosigner with excellent credit.  These are extremely important for anyone who doesn’t have a long or good credit history but doesn’t want high interest.  Most people have their parents cosign for them since their parents know whether or not to trust them, but many turn to family, friends, or other relatives to help.  If you try to get the loan alone, you’ll possibly lose a lot of money.  If you can’t find a good cosigner, but still want to lower your interest rates, talk to a student loan financial advisor who may be able to run through your best options.

Don’t Take Extra Money.

Most student loan companies will try to get you to accept more money than you need.  They’ll send you extra in the hopes that you’ll do some reckless spending and then will charge you high interest on everything.  Don’t let this happen to you.  Spend whatever money you need for your classes and lodging, and then send the rest back as soon as possible.  The less time that money spends on your accounts, the better.  It may feel tempting to get a new iPad or phone, but don’t let them trick you into signing away a ton of your future income. 

A college education is, unfortunately, something that Americans can put a price on.  Take these steps so that you’ll ease your ability to use a loan without having to feel indebted to these debts for the rest of your life.

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