I work in financial aid, and there is a ‘big hoopla’ going on right now in regards to financial aid. Essentially, due to said ‘big hoopla’ propaganda/media is advising students not to trust financial aid offices and to apply for the loans they need on their own. This is causing complete insanity for the following reasons:
1. Students must abide by the rules set out by the Department of Education. The financial aid offices at universities help students follow such rules. Without following certain rules (borrowing within the set cost of attendance), cheaper financial aid could be revoked.
2. Financial aid offices also work FOR the student. I don’t know how many students I had to counsel about the difference between Federal and private loans just last semester alone. I ended up just saying, “Listen, I’m returning your private loan and you need to call ‘lender’ to get it changed to a cheaper GradPLUS loan”.
3. Financial aid offices are the watch dogs. We read the fine print that some students overlook. If a lender or a loan sounds kind of funny, we have the experience to know this and we counsel the student. Good financial aid officers will always do so.
4. Financial aid offices know the rules and regulations. Similar to point 3, but on a bigger scale. Some private lenders have a business of taking students for a ride. They will offer benefits and great teasers, but when it comes time to repay the loan, it could be really ugly. Financial aid officers know who is good and who is bad. It’s not about offices signing with lenders and making partnerships.
5. Other aid could be available. Do not take a loan of any kind before grants and scholarships are exhausted. At that point, take Federal loans. Only take private loans if desperate.
6. Only use non-school channeled loans after speaking with a financial aid officer. These loans can be scary because they don’t even go through a financial aid office. So, the ‘guard dogs’ don’t even see if anyone could be raiding the ‘cookie jar’.
Just be careful and borrow wisely. Remember that not everyone graduates making six figures, so don’t throw money away! Keep your credit clean – you don’t want to have your college borrowing mistakes follow you.
“You need to live like a student, so you don’t have to live like a student for the rest of your life.”
-my good friend from TG