College Loans for Students

Get college loans for students. Find the best cheap student loans for college, including federal subsidized student loans.

Student loans are a way to supplement your college expenses, but they are not free money and must be paid pack with interest. However, loans are a viable option if you do not receive enough free money to attend college (aka scholarships) and/or if you do not have enough family or college savings plans.

Last updated on July 17, 2024 by College Financial Aid Advice.

Student Loans are NOT Free Money!

College Loans for Students

Stanford University, Palo Alto, California

Here are 10 tips when considering college loans for students:

1) Listen to your heart. Go to school for a career that you are passionate about and one that will grant a lifetime of happiness.  Once you graduate, you will feel more confident and be a valuable team player for your employer.

2) Only take out student loans when necessary.  Student loans must be considered a debt and not a free ride to college. (e.g. pay for tuition, books and education costs with loans.  Do NOT take out excess loans to support a lifestyle i.e. vacationing, clothes, a new computer, or eating out at fancy restaurants).

3) The amount of student loans that you take out should be lower than the amount of income that you will make after a year’s salary. (For example, if you take out $80,000 for a 4-year degree you should be making $80,000 or more in your first year of income).  If your student loans are more than your first year’s income, look for a least expensive school.  Take your general prerequisite courses at a community college. Maybe wait a few years and work until you can offset the costs of tuition.  Ask yourself: Is this something that I really want to do? Is this something I really have to go to college for?

4) Play with the numbers. How much will it cost in-state or out-of-state? What are the student loan interest rates? After scholarships, savings, grants, and other funds how much in loans will you need? Remember only take out what you need.

5) If possible take out a subsidized government loan before unsubsidized. Currently, subsidized loans are open to undergraduate students.  If you must take out a student loan take out a governmental student loan (i.e. a Direct loan). Why? The interest rates are fixed. There are multiple repayment and loan forgiveness programs for government loans i.e. income based repayment.  Remember to complete your FAFSA which will help determine if you qualify for particular grants or subsidized government loans.  The FAFSA also determines how much you can receive in government loans. (Note: the FAFSA should be completed before the college’s priority deadline.  If you have not filed your taxes use estimated numbers until you do file.  Then go back and update with revised numbers later).

Private student loans are the opposite of government loans. 

Private student loans have variable interest rates (which tend to be higher), may require a cosigner, loans may not be forgiven, and loan does not undergo income based repayment. 

The most important thing when taking out a student loan, or any loan is do NOT cosign. Because student loans a majority of the time are not dischargable in bankruptcy.  If something happens to the student were the student can no longer pay off the loans, the co-signer will be responsible for paying off the student loans.  Co-signers tend to be the student’s parents or partners. Don’t give this financial burden to others.  Paying for an education should be the student’s personal priority.  There are parent “plus” type loans which may help pay for the additional costs that are not covered by the student’s loans.  Again, look into government student loans that are available for parents before private student loans.  Parents may help their child, but only if the parent has a great income and financial stability. 

6) Listen to yourself, and then seek advice from others. If something doesn’t feel right, do not do it.  Sometimes the damage cannot be undone.  Some financial aid offices or loan agencies might try to have you take out more loans than needed.  They might convince you that you will be making all of this money afterwards when you are done with school based on your career choice.  Do NOT listen to them.  Life happens and anything can happen in life. (Play the what ifs scenario) What if you do not finish school? What if you decide that this career is not for you? What if? Only take out what you need to pay for school. Unless these people are going to pay for your schooling, simply say “no thank you.”  Only you are responsible for your personal finances. Do not be peer pressured by these bullies.

7) The interest on student loans compounds.  That means the interest on your loan will keep growing and growing.  Analogous to bread dough rising, somewhat slow and all of a sudden a large mess. Try to pay off the principal (starting) balance on your student loans while in school to keep the interest down.  Make sure there are no prepayment fees which can occur with private student loans.  Depending on where the student loan is taken out, you may be eligible for discounts or a monthly reduction when it is time to repay the loan.  These reductions may be a lower interest rate for automatic debit payments made from a checking account. Certainly with any debt, it is better to pay more than the minimum due every month. Come up with a repayment plan. Do you want to pay off your loans in 3 years or 10 years?

8) Do your research.  Know the terms and conditions regarding your loan. Know about consolidation, deferment and forbearance.  Know when you have to repay. Know the interest rate. Know the loan servicer (who you are borrowing your loans from) and keep in contact for questions or if you are having trouble repaying your loans.  If you don’t know something, ask!

9) Repay the student loans as soon as you are done with college and are newly employed.  There is a typical 6-month grace period depending on the loan.  Look into loan consolidation programs. Try not to place your loans in deferment and forbearance which will delay repayment, but interest may continue to accrue particularly with forbearance.

10) Just because you are paying for tuition with student loans now does not mean that you are covered.  This is not the time to splurge in other areas like going out every night, buying a completely new wardrobe, etc. This is actually the time to be grateful for having the opportunity to go to school.  Not everyone can afford a college education.  Not everyone goes to college. Know your income and expenses. Know that this debt will pay off in the long run for a career that you absolutely love.

Check out advice from other students about Paying off Student Loans.

Student Loan Calculator

The trick with taking out college loans for students is to never assume more debt than you will be able to repay, and that you should consider the value of the education that you receive in comparison to the size of the loan. For example, does the career opportunities and potential or certainty to earn a decent salary upon graduation justify the size of the debt? If so, you are to shop and apply for the best possible loan(s) with the most favorable terms, e.g. fixed and low interest rates.

Many college websites have net price calculators that will give you a good estimate of the true cost of attending that college, after accounting for scholarships and grants that you may be eligible to receive (both merit-based scholarships and need-based scholarships). These typically take about 20 minutes to complete.

Some colleges and universities use the College Board Net Price Calculator or NPC. This one is convenient because you can reuse the information that you have stored in College Board. You can access the College Board Net Price Calculator at professionals.collegeboard.org.

Once you have an idea of your Expected Family Contribution, you can estimate your loan amount, and use the above student loan payment calculator to estimate your loan payments.


Cheap Student Loans

College loans are either Need-Based or Non-Need-Based, Federal or Private.

If you want cheap student loans, federal Student loans are the most favorable student loans. They have the advantage of low interest rates and the government pays the interest on some of these loans on your behalf while you are still in college. Furthermore, the Federal loans do not usually need your credit history and may be eligible for the federal loan forgiveness program.

Federal Student loan is either need based or non-need-based.

Federal Student Loans include:

1. Subsidized Loans
2. Un-subsidized Loans
3. Federal Pell Grants (a grant not a loan, so they money does not need to be repaid)

Additionally, your parents may qualify to take out a Federal Plus loan to pay for your college expenses and it is not based on financial need. It requires the parents' credit history and parents can borrow any amount up to the unmet Cost of Attendance (Cost of Attendance minus other financial aid or scholarships).

All of these federal student loans are cheap student loans, because their interest rates and terms are more favorable than private loans. Pell grants are great because they don't need to be repaid. Subsidized loans are a good option because there is no interest accrued until after you graduate, and the interest rates are reasonable.


Private College Loans for Students

Private loans should be your very last resort for borrowing money to pay for your education. These private lenders require a credit history and the loan many have variable interest rates which may make your monthly payments to rise drastically in the future. These private loans are not cheap student loans, and they may have stiff penalties if you are late on any payments.

Sallie Mae is one organization that offers private college loans for students. You can also try your local bank.


Advice from Other Students about College Loans for Students

If I could go back and do anything differently, it would be starting a savings account while in college (or even earlier!) to prepare for the day when student loans start coming in, or better yet, pay my loans while in school rather than acting like they didn’t exist. 

 - Sarah from Pennsylvania

If you need to utilize college loans, then borrow only what you need and begin paying the interest while you are still in school. This will help alleviate incurred interests and costs after you graduate.

- Dewon from Illinois

A pro of subsidized loans is that interest payments are deferred while your going to school. Another positive note is that even after you graduate you have a grace period before you need to begin making payments. 

- Melesio from Arizona

The hardest part about going to college is paying for it, especially when you are unaware of all the free money that’s out there for you! Student loans are not the answer! I am $30,000 in debt from student loans (not including interest) because I didn’t have anyone to tell me that if I got good grades in high school I would get free money every year for it.

- Jessica from Kentucky

Do not take out large loans that you will carry on your back like a sack of bricks for the next 20 years. One of my students chose a private Philadelphia college for computer engineering. He worked hard, did everything a successful young person does, and did find a lucrative career after graduation. However, his starting salary does not begin to cover the couple of hundred thousand dollars in loans he owes. Now, he finds he cannot qualify to buy a house because of all he owes in college loans.

- Kim from New Jersey


College Loans for Students

See more information about college loans for students and parents at the links below.

Student Loan Overview

Federal Student Loans

Federal Plus Loan

Consolidating Student Loans

Perkins Student Loans

Sallie Mae Student Loans

Student Loan Debt Forgiveness

Paying off Student Loans

HomeCollege Loans for Students

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