Student Loans For Parents 101
Because the cost of college continues to rise each year, the question more parents are facing is not whether they or their children should borrow, but how should they borrow.
As with everything in college, the more research you do, the smarter your decision will be. And the smarter decision you make now, the less you and your child will end up paying in the long run.
The first and most obvious college financing option is personal savings that you or your child may have, such as college funds or trusts. The next option is scholarships and grants, neither of which require any repayment. Next to consider are low-interest federal and state loans, such as a Perkins loan or a Stafford Loan.
If you still need more money to cover the costs of college, that’s where a private student loan like the Laurel Collegiate Loan makes sense. As an alternative to financing through a high-interest credit card, borrowing against home equity, or tapping into 401(k) resources, private student loans offer flexible borrowing and repayment options.
What follows is a partial list of the things your loan can and can’t be used for. Use it as a guideline.
Yes, You Can
Tuition
Room & Board
Lab Fees
Computer & Accessories
Travel home
Studying abroad
No, You Can’t
Car payments
Laundry/Dry Cleaning
Doctor’s visits
Spring break
Extra dorm furniture
Athletic tickets
There's no more important investment you'll ever make for your child than a college education. Here are a few tips for borrowing wisely.
- Borrow what they need, but only what they need. It never makes sense to run up more debt than you have to.
- Decide on the best repayment plan. For example, one that starts after they graduate and have a job, makes good financial sense.
- Be wary of credit card debt. Because of high interest rates, many students graduate from college burdened with heavy credit card payments.
- Consolidating loans can be another way of lowering the cost and gaining greater control through one monthly bill.
- Whenever borrowing, choose the loan that’s best for you, your child and your particular circumstances. There’s no such thing as a one-size-fits-all loan.
It's important to determine as early as possible how your child’s college education will be financed. And we’ve made it easy to get started. Simply apply online, right now.
