How to Approach Student Loans

College loans are something that almost every family wants to avoid. But loans are a part of how people pay for college. A loan is a dollar amount given to you either by the federal government, or a private company to help pay for college now. And when you graduate you begin the process of paying it back. College loans are a legitimate help to paying for college but they are dangerous for many students because they do not really know how to make them work out for their benefit.

Student Loans Defined

Student loans are unlike the other money you may receive for college because they are dollar amounts that you will be expected to pay back. They will accrue interest and then you will begin some form of a payment plan after you graduate. There are many stipulations on how loans get paid back, but in short most college students will not pay it all back quickly. Traditionally it is a small manageable amount that you will be responsible for paying while you enter the work force.

How do you get a student loan?

Student loans are given out either by the federal government or by private loan providers. When a family fills out the FAFSA (Free Application for Federal Student Aid) they are eligible to receive federal government loans. All of these loans have maximum amounts that are pretty manageable for a successful college student. Both the student and their parents are capable of taking out loans.

 Private loans you will have to apply for separately and can be used to cover any gaps in your financial aid. However, there are far fewer regulations on these loans. Interest rates can be very high and people can be allowed to take out very large amounts potentially.

Taking out a student loan

The FAFSA is the first step towards getting a loan from the federal government. Afterwards almost every student will have the option to accept a loan for standard amounts if they need to do so. You will normally end up accepting the loan through your school in an online platform if you want to. However, parent loans can be a bit trickier. Private loans of any kind are not based off of FAFSA so you can obtain them more easily. But applying for a loan is always based on credit. Student loans are given out pretty liberally so the concern with applying for a private loan is that it will be up to you to ensure that the amount you borrow is going to be manageable, and for that reason alone, it can get out of hand very quickly for many students.

The process of applying for a private loan will not be very different from any other type of loan you might want from a bank. You will need various forms of documentation like a Social Security numbers, pay stubs, and of course proof that you will actually be in college.

What are the maximum loan amounts?

The maximum amount that you can receive in a loan is really only capped for students through the federal loan programs. The amounts range from about $5,500$ all the way up to $12,500. It is not unusual for loan amounts to increase with the cost of attendance at a school across four years. But parents can take out what is called a “Direct Plus Loan” to support their child through college on top of this.

Coach Rob’s Note: Click here for a full breakdown of all the different federal loan options.

There is no true cap on what you can receive on a private loan, but I must reiterate that you should look to avoid private loans. If a college is only affordable with private loan help, beyond federal money, it is a good indicator the school is probably unaffordable for you.

Coach Rob’s Note: Don’t go under-recruited! I put in the hard work for you to know exactly which colleges already want to recruit you, which ones will view you as a top recruit, and how to get their attention. Book a meeting with me, Coach Rob, and see how easy it can be to get the offers you deserve!

Coach Rob is a recruiting expert and the Founder of SCA Recruiting. He is also the author of the book Winning the Ship: How to Win the College Athlete Recruitment Game. Available now on Amazon.