College Student Loans

Written by Seth Cotterell
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Cost can often be an overwhelming obstacle to college attendance. With tuition rates ever increasing, it can seem like an impossible hurdle. For people who are serious about attending college, however, there are many sources of financial aid that will make their college dreams into realities.

Scholarships and grants are attractive sources of financial aid. They are free money; neither have to be repaid after graduation. The difficulty with these is that they can be difficult to get. Scholarships are often based on achievement, and the competition is unbelievably fierce. Only the cream of the crop, top students will earn that free ride. Grants are problematic too because they are federally awarded and are based on financial need. The amount of money you or your parents make is not necessarily an accurate reflection of your financial position, and most people who do not qualify for grants still can not afford the cost of tuition.

Financing College with Student Loans

For a vast majority of degree seekers, student loans are a necessity. Student loans are another source of college financial aid and they are what allow most students to attend a university. Student loans are widely available through the federal government, individual universities, and private organizations like banks and credit unions. Practically anyone can qualify for a student loan of some sort.

The drawback of student loans is that they are a loan just like any other. Once a student graduates, the loan must be repaid. Subsidized loans do not accrue interest while the student is enrolled in courses, but unsubsidized loans do. Following graduation, the original loan amount, called the principal, will have to be repaid plus whatever interest has accrued. Defaulting on a student loan will damage your personal credit, so you will have to be very careful and financially responsible to make sure your student loan payments are made on time every month.

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