How To Pay For College Tuition


Different Types of Loans for College

Alternative Student Loans - another name for private student loans

Bar Study Loans - Loans used to pay for expenses related to studying for and taking the Bar Exam (the qualifying exam for practicing lawyers). Bar study loan borrowers can take out enough to cover living expenses during the preparation for the Bar Exam, but check with a lender for possible limitations.

Certified Private Loan - A private student loan that requires notification and verification by a college or university official prior to funding. The school typically verifies that the borrower is not taking out more money than the total cost of education less other aid. Certified private loans are generally disbursed to the school directly to be applied to the student's account. Any remaining funds are returned to the student.

Consolidation Loan - A type of loan that allows a borrower to combine several individual loans into one single loan. This can simplify the borrower's paperwork (one loan payment to make instead of several) and may bring additional benefits. Student loan borrowers can consolidate federal student loans together but not combine them with private student loans.

Continuing Education Loans - Student loans specifically for students enrolled in non-degree programs (not leading to a degree to certificate). Continuing education students' eligibility for certain loans and loan amounts depends on their enrollment status.

Direct Student Loans - Loans made by the U.S. Department of Education (instead of a private lending institution) under the William D. Ford Federal Direct Student Loan Program. Schools can opt to participate in the direct lending program where the student loan lender is the U.S. Government. Direct Loans consist of Direct Subsidized Stafford Loans, Direct Unsubsidized Stafford Loans, Direct PLUS Loans and Direct Consolidation Loans. Borrowers can receive Direct Loans only if the student's school participates in the Direct Loan Program.

Federal Student Loans - Loans offered to students to assist in the payment of the costs of higher education that are supported and regulated by the federal government. Also known as government student loans, or government-backed student loans.

Graduate PLUS Loans - Federally guaranteed student loans that are available to graduate and professional students. A version of the Parent Loan for Undergraduate Students (PLUS).

Home Equity Loans - Loans where the applicant's property is used as collateral for a line of credit based on the available equity in the home (much like a second mortgage). Homeowners can borrow  up to the current value of their home minus any outstanding amount owed.

K-12 Education Loans - Loans for K-12 private, independent or boarding school education used expressly for educational costs such as tuition, room and board and other related expenses. K-12 private education loans are taken out from banks, lending companies or other private entities in the parent's name.

Perkins Student Loans - Student loans awarded to undergraduate and graduate students with exceptional financial need. The Perkins Loan is a subsidized loan, with the interest paid by the federal government during the in-school period and the nine month grace period.

PLUS Loans (Parent Loan for Undergraduate Students) - Low-interest federally backed loans that parents can take out on behalf of their undergraduate children to pay for educational costs.

Private Student Loans - Non-governmental student loans made by  private lenders expressly for paying for college expenses such as tuition, room and board, and other associated costs. Private student loans are based on credit score and usually a credit-worthy co-signer. Sometimes private loans are called
"alternative loans." Private student loans can be certified or uncertified.

Residency Loans (or Medical Residency Loans) - Private student loans expressly for the purpose of paying for educational expenses incurred during medical student residency programs. Borrowers can often borrow to cover living expenses for the time relevant to the residency program.

Stafford Loans - Fixed-rate, federally-backed student loans available to undergraduate and graduate students. To qualify, regardless of need, you must fill out the FAFSA (Free Application for Federal Student Aid). The Stafford Student Loan comes in two main structures. At many schools, Stafford Loans are offered via private lenders (banks, credit unions, etc.). At some schools the loan is available directly from the U.S. Government, in which case it is called a Direct Stafford Loan.

Student Loan - A loan offered to students, usually those in higher education programs, to assist in payment of the costs of their education. Student loans can also be called college loans, education loans and come in many forms.

Subsidized Stafford Loan - A type of a Stafford Loan available to undergraduate and graduate students where no interest accrues while the student is enrolled.

Uncertified Private Student Loan (or Direct-To-Consumer Student Loan) - A  private student loan that does not require a school official to certify any aspect of the amount borrowed. Uncertified private loans are usually disbursed directly to the borrower.

Unsubsidized Stafford Loan - A type of Stafford Student Loan available to undergraduate and graduate students where interest accrues while the student is enrolled.


That being said, there are other alternatives to finance college tuition in scholarships, grants and awards that should be reviewed to see what you may qualify for. One source that I found helpful is located here.



 Student Loan Default Rate Increases Amid Troubling Economy

MMI suggests finance options for obtaining a higher education

HOUSTON, Sept. 15 /PRNewswire-USNewswire/ -- According to a recent report released by the U.S. Secretary of Education, student loan default rates are up a staggering 7 percent, up from the 2007 default rate of 6.7 percent. The default rates for student borrowers are considerably higher for those who attended public schools than those who attended private ones. Due to a lackluster economic turnaround and high unemployment, it's no surprise that student borrowers are struggling to make loan payments. 

To find solutions for managing the cost of a higher education, consider the following advice from the financial experts at Money Management International (MMI): 

Look for scholarships. Scholarships are the best way to pay for school; it's free money that doesn't require repayment. There are several online sources to help students find great scholarships, such as FastWeb, FinAid, and the Financial Aid Resource Center.

Apply for federal grants. Obtaining a grant is another way to pay for college with free money. To secure federal grants fill out the Free Application for Federal Student Aid (FAFSA). Also, check out the Academic Competitiveness Grant or the National Science and Mathematics Access to Retain Talent or SMART grant.

Choose the right school. Sometimes affording tuition is as easy as choosing a school that fits your family's budget. It is cheaper to go to school in-state vs. out-of-state. Also consider a public funded school over a private school. Students can find a college cost comparison tool and apply for financial aid at www.CollegeBoard.com.

Finally, consider an alternative program. "There are other programs that are just as rewarding, but cost significantly less than a university program," said Cate Williams, vice president of financial literacy for MMI.  "For example, instead of a four year nursing degree that could cost up to $40,000, consider a certification program in respiratory therapy at a community college for only $27,300."

Forget Loans, Secrets to Getting Free College Grants to Pay Tuition

College tuition increases will continue as the economy continues to falter. Most people believe that a good college education will be the answer to their prayers and many institutions capitalize on this. Cost do rise as we all know, but the cost of an education seems to rise more quickly than other expenses. Every parent wants to see their child graduate college and certainly does not want to be responsible for their failure to get a degree because of money. 

Finding free college scholarships and grants is not a simple task, however, thanks to some government programs available and with the help of the college or university that you expect to attend, there are some free college scholarships and grants available if you know where and how to research these programs.

That being said, there are other alternatives to finance college tuition in scholarships, grants and awards that should be reviewed to see what you may qualify for. One source that I found helpful is located here.

http://www.freecollegetuition.financebusinessadvice.com/