Loan Schools (Understanding the Loan Schools Offer)
A college education is fraught with incredible expenses. You have to pay for tuition, various fees, housing, food and books just to name a few major expenses. There are a number of financial aid programs that you will become familiar with as you work toward paying for your dream of higher education. You can expect to have to apply for federal financial aid programs, merit based gift aid and different types of loans. Gift aid is relatively easy to understand; you apply for money and it is given to you. Understanding the loan schools offer can be a little more complex. There are rules for who is eligible for the loan schools offer and how much they are eligible to receive. You are also required to repay the loan schools offer and if you do not pay the loans off in full you can be subject to legal action.
Gift Aid
Grants – the federal government offers a number of grants to student generally based on income level and financial need. If you have a certain level of income you will receive a particular amount of money in the form of grants. There are a few programs like Pell and SEOG (Supplemental Educational Opportunity Grants) that offer grants to students in the greatest need. There are also grants offered to students based on merit for such things as scores on your college placement and aptitude tests or advanced placement (AP) courses. These are generally offered by the school.
Scholarships – this form of gift aid comes mainly from private organizations seeking to reward students for their knowledge, achievement, compassion, etc. In some cases you are nominated for scholarships, in others you apply. Either way, when you receive this aid you do not have to repay the amount you receive.
Work/Study
This program allows the student to earn money to pay toward tuition. You have to work a particular number of hours per week at a location on campus that typically is associated with your career goals. A portion of your earnings goes into your pocket and the rest is paid to the school as a segment of your tuition. In some cases this set up is as a loan you take out from the school and repay by working for the school.
Loans
Federal loans – schools offer a variety of federal loans that can be (but are not necessarily) based on financial need. These programs come directly from the government or through private institutions backed by the government. In most cases you have to repay these loans in full. However, there are cases where loans can be forgiven or cancelled.
Private loans – schools and private financial institutions offer private loans largely based on your credit history. Good credit gets you a good loan deal. These must be repaid without exception.
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