With the rising price of tuition and budget cuts at state and federal levels, available grants are shrinking, forcing students to borrow money. Costs are going up and so is the risk of falling into a deep hole!
Student loans come in many different shapes and sizes. They may seem an effective way to pay for college, but if you don’t do your research you could end up with a level of debt you cannot afford with your starting salary fresh out of college.
Your first consideration should be the cost of your school in conjunction with the amount of grant and scholarships offered. Grant aid should provide at least 50% of the cost of attendance in order for your choice of school to be affordable, especially if you don’t have any resources of your own.
Many private banks and some college financial aid offices will not hesitate to offer you an assortment of loans regardless of the quality of the loan. Although the value of an education is undisputed, if the debt you are asked to take will put you and your family in a worse financial situation than if you don’t earn a degree, you should reconsider your decision.
Before you take out a loan, ask as many questions as possible. Don’t just sign an offer or an application without understanding the bottom line.