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Student Loans
When to Apply for Student LoansTiming is Everything in the Student Loan GameBy Mindy
BillSavings.com Brief:
Applying for student loans can be a nightmare to navigate. Find out when to apply so you can land as much funding as possible.
Going to college is an exciting time – unless you’re worried about the expensive tuition bills found at most universities these days. Fortunately, student loan programs are plentiful in most places. The trick is simply knowing how to land the right student loans for your needs. Read on to discover the essential steps you need to take to get the best student loans. Begin preparing one year in advance The best time to start your hunt for college loans is in the year right before you plan to leave for college. Most student loan programs begin awarding funds as far as twelve months in advance of a school year. If you’re able to get your financial affairs in order so you can get applications sent out, your chances of landing higher numbers of greater loan amounts increase dramatically. Get your financial affairs in order Some of the best student loan programs require that you submit a significant amount of personal information regarding your financial affairs. This could include past tax returns, investment statements, or salary information. If you will be financing your own college education, start assembling documents relevant to your current financial affairs. If your parents will be helping you out with tuition, ask that they do the same. Gather statements relevant to all investment sources and make sure you’re paid up on any financial liabilities, such as taxes. If your parents are currently paying tuition for a sibling’s college expenses, ask them to find out how much they’re already paying. That amount could factor into your own financial aid application (and it could actually mean surprising benefits to you). File your FAFSA The Free Application for Federal Student Aid, also known as the FAFSA, should be completed by anybody who’d like any form of financial aid, including student loans. The FAFSA is a form that determines your eligibility for federal student financial aid. It must be filled out annually and can be submitted electronically. The FAFSA is made up of several questions regarding your finances (or the finances of your parents, as the case may be). This is why assembling all your financial documents ahead of time will come in handy. The answers you submit to the FAFSA questions get plugged into a formula that determines your Expected Family Contribution, or EFC. The EFC dictates the amount of money you or your parents will be required to contribute to your education. If there is a difference between your EFC and the total cost of your education, that difference is the amount you’ll want to be awarded in student loans. Choose your schools The process of being accepted to a university and getting enough financial aid in place to be able to attend that university is a delicate one. On one hand, you can’t choose a school until you’ve been accepted to that school. You also can’t accept a school’s offer for enrollment until you know how much financial aid you’ve been awarded. To top it all, you usually won’t be awarded any financial aid unless you’ve been accepted to a school. The trick is in meeting every deadline and acting quickly on your decisions. Once you’re accepted to a university, you can submit a copy of your FAFSA to that university’s financial aid department. This is why it’s so essential to have already filled out your FAFSA – the sooner you get it to a university’s financial aid department, the sooner you can be awarded aid. At that point, the financial aid department will create a financial aid package for you. This package will list all the loans and grants the school can give you (Note: the more grants you get, the better – these don’t have to be paid back). If you’re going to need to make a choice between different universities, wait until you’ve received a financial aid package from each one. At that point, you can compare offers to find out which is the most financially viable situation for you or your family. Consider private funding sources If the financial aid packages you receive do not offer you the amount of funding you’d hoped they would, you still have several other funding sources to consider. Banks, private lenders, and non-profit organizations offer an array of different types of student loans. The best way to proceed is to contact the financial aid office of the schools you’re considering. Ask who they recommend for additional funding. Universities often have special relationships with different lenders that offer better loan rates to their students. From there, contact the recommended lenders and ask about the loans they’d be willing to give you. Feel free to ask the financial aid offices from each school you’re considering for assistance during this process. Stay on top of deadlines to get more money Many student loan programs are funded on an annual basis. They often assign loans on a first-come, first-served basis. This is why it’s so crucial to get your applications in as soon as you possibly can. The sooner you apply the more money you’re likely to receive. Waiting till the last minute to apply for student loans could mean that possible sources of financial aid for you have already been drained. Because of this, you should always stay on top of deadlines and try to have all information assembled and submitted as early as possible. 3/23/2009
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