Common student loan mistakes that you must avoid « Online Education Guide

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April 12,2012
by:
Dallas Browne

If you thought that there are several job opportunities in the current world, it is time you groom yourself to take advantage of it. Several opportunities that we see today come with neck to neck competition. Your educational background can make a huge difference in edging out the competition and helping you get way ahead of the rest. Take help of student loans that are available today and you can gear up to the challenges that await you when you get hunting for a job. Having said this, there are some mistakes that you must avoid while talking about student loans.

Students often end up opting for uncertified loans from private lenders rather than considering the FAFSA. This is a huge disadvantage because you have a lot to gain from loans you get by filling in the FAFSA forms. The Federal loans are any day beneficial because they charge you a relatively lower interest rate. Also, they give you free insurance cover which is not the case with rest. As a student, you must make the effort to find all details about the application process for Federal loans rather than opt for an easier way out.

Ensure you talk to the financial aid office before applying for the loan. The loan amount you are eligible for depends on the family income, the number of members working in your family and so on. You may have availed some amount for the previous year but that does not mean you are assured the same amount this year too. The amount may vary if circumstances have changed in your home. In case your parents have retired or have been rendered disabled, you can apply for a higher amount compared to the previous year. You must hence be proactive and find out any chances of getting more aid before you apply.

There are times that you will not use all the money you get as part of your aid. In such cases, be wise enough to put it aside in a savings account to help you with unforeseen circumstances rather than splurge it on clothes or miscellaneous expenses. As a student you often foresee the need to save for future but there could be situations when your computer needs to be repaired or you need some books for your studies. The small saving you made will help you at these times.

If you are in a situation when only an uncertified loan is possible, do not apply for a huge amount. The fact that there is no cap on the amount you can apply for may tempt you to avail a slightly bigger loan than necessary but you will feel the repercussions when you start repaying it. The increased interest rates will prove to be a huge burden on you and you will find no escape either. Plan your loan right and make a great beginning towards a successful life. Take help from reliable resources to help you with your planning so you have no chance of faltering in the process.

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