Common Financial Aid Questions Answered
Qualifying for financial aid is one of the most common ways students pay for tuition, text books, housing and other costs associated with going to school. In fact, most students use some form of financial aid, whether it’s a student loan or a scholarship.
Here are some of the most common financial aid questions and their answers.
Q: Who can apply for financial aid?
A: With so many options available, virtually everyone can apply for financial aid.
There are so many different kinds of financial aid available, that nearly everyone can apply. Whether you are a new freshman, a returning student, a professional attending night classes or going to school part time, you can apply for financial aid.
Look at the specific requirements for scholarships, student loans and grants to find out which ones you can apply for. Also be sure to look for very specific financial aid options you may qualify for. Some organizations offer financial aid to students pursuing a specific degree, who are members of the military or even to students with specific family situations and backgrounds.
Q: Are student loans risky?
A: If you choose the right lender, loans are a safe way to pay for college.
Student loans are a safe, risk-free way to pay for college if you choose the right lender. Government student loans usually have lower interest rates and often come with a few options when it comes to repayment plans.
You can also apply for a student loan from a professional, trustworthy private lender. This is a good option if you don’t qualify for government loans or if you need additional funding.
Q: Do student loans affect my credit?
A: Student loans can affect your credit, but in most cases they actually help your credit.
Your student loans do have the potential to harm your credit score. The amount you borrow as well as your payment history will be added to your credit report. Late or skipped payments will hurt your credit score.
But, if you make regular payments you will actually be benefitting your credit score, so getting a student loan can help you qualify for other loans, like a car loan or home mortgage in the future.
Many banks also see student loans as “good” loans, since you borrowed in order to further your education, and will take that into consideration when you apply for another loan.
Q: How will a divorce affect my financial aid?
A: If you or your parents are divorced, it will affect the way you apply for financial aid.
If you are divorced, in most cases you will only report your income when you apply for financial aid.
If your parents are divorced, the parent you live with or spend the most time with is the one that should fill out paperwork with you and report information as needed.
Q: Do I pay back financial aid? When?
A: You will be required to pay back some forms of financial aid. Each type of aid has a different kind of repayment requirement.
You do not pay back scholarships or grants. These kinds of financial aid are given to you to help you earn your degree and are not loans.
However, if you take out a government student loan or get a loan from a private lender, you will be required to pay it back.
Different lenders have different repayment requirements, so make sure you know those requirements before you sign for a loan. In many cases, you can start paying back your loan after you gradate. Some lenders have different repayment plans you can choose from or set your monthly payment according to your income.
Financial aid is available to almost everyone and understanding what your options are will help you prepare for college and even earn your degree faster.