|By David Pilley on November 5, 2011
Even if you don’t have the money to pay for it now, you can still go to college to work on a degree. This may sound just like getting a credit card, but, believe me, an education is much more important than anything you will ever buy with plastic. There are different types of loans and grants that are at your fingertips. Some may need a cosigner, but I am going to reveal types of loans that do not need one.
Before getting any type of loan for school, you need to fill out a Free Application for Federal Student Aid (FAFSA). A FAFSA form will ask numerous questions about your financial situation, and you need to answer as accurately as possible. Questions include asking about your income, how much money you currently have in your bank account(s), how many people are in your family, and whether you are dependent or independent. You can file the form by filling it out on the website, mailing a completed paper copy, or getting help from a professional. A new filing period begins Jan. 1, and many states have different deadlines for submission.
Perkins Loan. A Federal Perkins Loan is available to both undergraduate and graduate students who demonstrate financial need. For undergraduates, the yearly limit is $5,500, while for graduate students, the yearly amount from a Perkins Loan is $8,000. This loan is subsidized, so interest does not get tacked on until you begin repaying the loan. (The interest rate is fixed at five percent.) The repayment period may last up to 10 years, and you will start repaying it after having been graduated, fallen below half-time status, or withdrawn from school for nine months.
Stafford Loan. Direct Stafford Loans are a little bit easier to get because it isn’t always necessary to demonstrate financial need to get them. (To have it subsidized, it is necessary, but it’s not necessary for an unsubsidized Stafford Loan. You still have to fill out the FAFSA to get it, of course!) If you do demonstrate financial need, you will be able to get a portion of the loan subsidized (meaning interest will not come into effect until you start paying back the loan). With each successive year in college, you will be able to get more, but being dependent or independent makes a difference, too. If you are dependent, in your first year you can receive $5,500 (up to $3,500 can be subsidized), $6,500 in your second year (up to $4,500 subsidized), and $7,500 third and beyond (up to $5,500 subsidized). If you are independent (or a dependent whose parents cannot obtain a PLUS loan), you can receive $9,500 in your first year, $10,500 the second year, and $12,500 third year and beyond (subsidized limits remain the same). If you are a graduate student, you can receive up to $20,500 each year (up to $8,500 can be subsidized). The current interest rate is fixed at 6.8 percent, and you will start repaying the loan after a six-month grace period.
Besides the Perkins and Stafford loans, your school may also have a work-study program, where you can earn money to pay for tuition. A co-signer is not necessary for you to be able to pay for college. Just remember to fill out a FAFSA form first!