Finding Money For College – 4 Flavors of Student Loans

Staying in school to get a degree takes skills. Like finding money for college. Bet you thought it would be easier!

Funding school can seem like a second job. You have tuition bills due, you need rent money, and textbooks for next semester, right? You shouldn’t have to constantly look for cash just to finish that degree.



The Basics of Financial Aid

The basics for finding money for college fall into just a few categories:

- Savings: if you’ve got thousands waiting for you to spend at school, you probably wouldn’t be reading this. You’d be watching satellite TV or playing games, right?

- Scholarships: people with big bags of cash, waiting to give it to you. Yes, scholarships do help thousands in finding money for their college needs, but you have find them and compete well. The forms and essays can take a lot of time. Worth it if you can find money this way, not so much if you are in a hurry and need it now.

- Grants: Get your paperwork in on time. And pricey private schools will still need more of the Benjamins anyway.

- Student Loans: Borrow your way to a diploma. It works, but you still need some savvy. My student loans page has some ideas on how to do it right to find money for college and not go with a bad loan. And learn about how much to borrow on this page.



- Second Mortgage: Should you refinance and take cash out to pay for school? You decide. Look at this comparison of GSL's and 2nd mortgages and see which one works best for you.

If you’ve covered your bases, and you’ve checked your cookie jar, and no one is offering to give you a check with several zeroes, then you probably need a loan.

Multiple Choice Student Loans

College loans come basically in 4 flavors:

1. Stafford loan, a loan guaranteed by the federal government, which can be funded by private companies or directly from the government agency, subsidized or unsubsidized (see my page on subsidized student loans to learn more about the difference). This is the one you want, if at all possible. And you want it subsidized, of course. You can also consolidate student loans of this type, which can help keep the payments down.

2. Perkins loan, typically only funded by colleges and universities. These have a guaranteed interest rate as well. A close second only because not as many places have these student loans.

3. Grad PLUS loan, originally set up for parents to find money for college for undergrads, but now open to graduate students directly as well. This loan gives you parents an alternative to using a home equity loan or refinancing your mortgage. The government doesn't subsidize these loans, either.

4. Private student loan , from lenders who fill the gap for students that have maxed out other money sources for their college degree. Finding money for college through a private loan can be a life saver, and often offer similar repayment terms.

By the way, you can learn about student loan deferment and how it works. Or, you can hop over to another page on student loans for great ideas on where to look for a loan.

If you have bad credit, hop over to my student loans with bad credit page for some ideas.

That’s the basic money for college student loan list. You can break this list down into 2 groups, by the way, the money now group, and the deadline group. If you meet deadlines and fill out your forms well, you can apply for grants and scholarships. If you prepared ahead of time, you may have savings. Also, you can read one of my university tuition experiences that can show you the benefits of a student loan over credit cards.

How fast can you get a Student Loan?

If you need to find money for college soon or right away, you have to go with loans, or perhaps the lottery ;). You can get a federally backed loan in about 2-4 weeks if you hurry and fill out a FAFSA. Maybe a little longer and your school may have some deadlines to meet. To find money faster than that, you’ll need a private loan.

Some schools offer short term or emergency student loans that you pay back with in 6 months. These can really help, but only to get you out of an immediate problem.

I have a short report with much more information about the process of finding college money, especially a student loan. It's free, and you can download it now for a quick read. It's in Adobe reader PDF format.

These are the facts of finding money for college funding. I hope this helps you sort out your options.

Don't give up. Determined people can find a way to finish college, just keep at it.

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