Loans For College Students

If you're an American citizen, then you've got it made as far as loan availability. With a maximum lifetime loan cap of over $100K, you'll have the ability to borrow enough money--just like me-- to pay your way into a professional degree.

First off, the basics: In order to obtain a federal student loan--the easiest to get-- you need to be enrolled in a degree program at a college or university. Next, you'll need to complete the Free Application for Federal Student Aid; this is required to receive just about any type of financial aid, not just student loans. Applying for the FAFSA is incredibly easy. Simply go to FAFSA to begin the process. You'll want to have your standard identification documents-- social security number, driver’s license-- handy, as well as your most recent tax records and bank statements.

If you're a freshman just starting out, you can borrow up to $3,500 each year for tuition, fees, and housing. That number increases each year that you're in school; if you're a sophomore, you can borrow up to $4,500 for the year. Juniors and seniors are eligible to borrow $5,500, with much more for post-baccalaureate degrees.

If there's one word you've noticed I've used a lot in the preceding paragraph, it's borrow. That's because these are student loans which must be repaid, not a scholarship or grant. You're borrowing money from one of many lenders, the funds for which are backed by the US Federal government. If you don't repay your loans, they can garnish your wages or sue you in federal court.

Federal Student loans are basically in one of two categories: subsidized or unsubsidized. Subsidized loans have the interest paid by the federal government. Keep in mind that, since this is a loan which must be repaid, interest keeps accruing on the principal. Unsubsidized loans are those in which the interest is not paid by the government. That interest keeps accumulating on top of the principal, increasing the amount that you'll have to repay in the future.