Thursday, August 4, 2011

Student Tips: Paying for school and student loans

A few students who applied to SCI-Arc as transfer students, couldn't make it here even after they got accepted, because of finances. I thought of sharing some experiences that could help you organize yourself financially so you could receive a very good education.

I can't stress enough how important it is to apply to multiple schools. My friends I spoke of above were all ready to move to LA. They were looking for car movers and places to rent. Then something unexpected happened. Their student loans got rejected. If SCI-Arc was the only school they applied to, today they would be without a school. Thankfully they had applied to UF and got admitted there as well so it worked out for them.

The second thing I can't stress enough about is to have a strong application along with a very good letter of intent, an excellent portfolio and very good recommendation letters. This will increase your chances of winning a scholarship from the school. If you are eligible for academic scholarships or any scholarships for that matter, you should apply. You should aim for a scholarship that will cover most, if not all, of your tuition.

Next step would be to apply for federal aid - FAFSA. One of the most important steps in applying to college is filing your FAFSA (Free Application for Federal Student Aid). You will need your tax information from the previous year to file the FAFSA. All details about filing for FAFSA can be found in their website here. If you want help filing your FAFSA usually the school financial aid office can help you with this. But trust me, you can fill it on your own online, just read the instructions carefully.

Then you should apply for financial aid with your school. Usually, all schools have a set of documents they would require you to fill for financial aid. These documents can be found at the financial aid office of the school and there will be staff who can help you with this. You should talk to them and don't be afraid to ask questions until you have absolute clarity. Remember, when in doubt, and that you will be, ask for them. Financial aid applications and the process can be confusing. Take time to do it. Don't miss the deadlines because money gets allocated pretty fast.

Between federal aid and financial aid with school, you should get a combination of grants, scholarships and loans. There are various grants like Pell Grant and grants from the school that you don't have to pay back. There are loans from the federal government such as the Stafford loans and PLUS loan. Based on if you are an independent student or a dependent student, you should get a combination of these options that should cover a good chunk of your tuition and other study expenses.

I fit in the category of an independent student because I file taxes on my own and I'm married. Your financial aid from the government and the school will vary greatly upon your dependent status.

Until I started at SCI-Arc, I didn't have any student loans. But, like any private school, SCI-Arc's high tuition required me to seek loans to pay the tuition. I'm taking all the Stafford loans they are offering me and I had to take out a private loan to pay the Summer tuition.

As far as I know, there are 3 types of federal student loans. The subsidized Stafford loan, the unsubsidized Stafford loan and the PLUS loan. Click here to read more about the Stafford loans & the PLUS loans.

Private loans are a bit tricky. Usually your school can provide you a list of approved or preferred lenders. This list will usually consist of a few banks and specialized student loan providers like Sallie Mae. I went with Sallie Mae because they know the drill about student loans, that's their specialty so they know the kind of problems you face and they know how to find solutions faster. They are pretty quick in processing the loans too.

The main thing to remember about student loans is that you have a good credit score and if you have a co-signer, that they have a good credit score and a good pay stub to show to the bank. I would check with the school before applying for the loan just to make sure that your chances of getting the loan approved is pretty good.

You have also remember, you may have to chase the bank and the financial aid office to see through that the loan money gets dispensed on time. So be on top of them.

As you can see, you have to be quite organized with the whole process. Do your research. Read on line, talk to people. Be careful not to apply for too much money in loans than you actually, absolutely need. You don't want to graduate and walk out with $ 150,000 in debt and not know how to pay it off. Loan Payment calculators such as this, can help you figure out how much money you will be repaying over how long.

Good luck and let me know if you have any questions :)