The world of student lending is confusing. But here’s a rule to remember: always take out federal student loans before you consider the private option. They’re usually cheaper and have more favorable repayment terms. But if you’ve maxed out your federal aid eligibility or don’t qualify, then you may need a private student loan. Here are 5 steps to choose the right private student loan:
1. Compare you options first.
Knowing your options and comparing interest rates, repayment terms, and borrower benefits could save you thousands. Compare your options!
2. Look beyond the annual percentage rate.
The APR is important, of course, but there are other factors to consider, such as the total cost of the loan, deferment options, and first payment due date.
3. Confirm the interest rate for which you qualify.
It’s important to confirm interest rates with the lender you are researching. The advertised rate and your actual rate may differ, depending on the credit profile of the borrower and co-signer.
4. Find a credit-worthy co-signer.
Most college students will need a co-signer. Increasingly, this goes for graduate students, too, since many do not have a long credit history. And remember: the better your co-signer’s credit, the lower your interest rate.
5. Choose a lender with good customer service.
Borrowers are customers, too, and deserve to be treated as such, so choose a lender you can reach with a toll-free telephone number or fast online assistance available 24/7.
The only thing harder than studying for your classes is finding the money to pay for them. Good thing we’re here to help you borrow cheaply. Here’s the smart guide to student borrowing:
Get started today by comparing your private student loan options. Just remember to:
- Max out your federal aid before you consider the private option. Federal student loans often comes with lower interest rates and more favorable lending terms, so it always pays to use up your federal aid eligibility first. That means: fill out a FAFSA if you haven’t already.
- Know how much to borrow. One of the most expensive mistakes a student can make is borrowing too much money. Budget for all your costs, including extraneous things like entertainment, transportation, printing, and parking. But never plan on using your loan disbursement for stuff you don’t need, like a vacation.
- Find a co-signer. If you’ve got a bad credit score or no credit history, then chances are you’ll have trouble finding a private student loan without a credit-worthy co-signer. But that’s not a bad thing! Having a co-signer improves your chances of qualifying for a private student loan and may actually lower your interest rate, saving you money.
- Keep your expected costs down. There’s an important mantra to remember: the less money you plan on spending, the less money you have to borrow. Our sister-company, ValoreBooks, can help. Stop paying retail prices on textbooks. Shop or rent with ValoreBooks next semester and save up to 90%. Then use that money to pay some of your tuition bill.
- Know your borrower benefits. Private lenders offer various benefits to borrowers. Some provide interest rate discounts for enrolling in auto-repayment or for students who’ve made a certain number of on-time consecutive payments. Some lenders even cut your premium by a percentage point or two when you graduate. The key here: know what’s offered ahead of time and calculate those benefits into your total cost.
Summer break is finally here, but that doesn’t mean you should spend all your time relaxing. Not when there’s money to make! After all, the more money you earn this summer, the less you have to borrow when next semester’s tuition bill arrives. So work hard, save plenty, and get creative. Here are a few ideas on how to earn more money this summer:
1. Sell used textbooks.
Got textbooks from last semester? Or even last year? Sell them with ValoreBooks, our sister-company, for cash! We have the highest sellback prices in the industry. Plus shipping is free and price quotes are instant. See how much your textbooks are worth.
2. Sell used CDs, DVDs, and more.
You can also sell used iPhones, iPads, video games, DVDs, and CDs using ValoreBooks — so clean out that entertainment center and turn your old stuff into cash. Shipping is still free and price quotes are still instant! Sell your stuff for cash!
3. Get a summer job.
This one seems obvious, but it’s surprising how many college students don’t work during the summer. Score even a part-time gig at a restaurant, park, summer camp, movie theater, resort, etc. But don’t wait to apply! Summer jobs are often in high demand, so apply ASAP.
4. Create your own job.
Can’t find a job? Make one! Offer your services as a babysitter, house sitter, pet sitter, lawnmower, or landscaper. Got other talents? Use them to make money. For leads on potential clients: check with your parents’ friends and coworkers.
5. Spend less.
Okay, “spending less” and “earning more” aren’t exactly the same thing, but both result in more money. Thankfully spending less is pretty easy, especially in the summer. Most towns and cities have free events and concerts. Plus the weather is getting better every day, so go enjoy the wild (and free!) outdoors. Skip restaurants, theme parks, and expensive vacations. Make your own fun!
Some advice from Yoda:
It’s far easier to spend money than to earn it, which is why we’ve compiled a list of tools that will help you stay smart about spending. Check ‘em out:
Organize all your finances in one place — fast and for free. With Mint, you can see what you’re spending, how you’re spending it, and learn how to keep more of your money where it belongs: in your pocket.
2. Price tracking sites.
If you’re shopping online and you aren’t tracking prices, you may be spending more than you have to. Know what stores are selling the product you want at the lowest price, and see how that price has changed over time. That way you can know whether to buy now or wait for prices to drop. Websites like Shopzilla and Pricegrabber can help.
With ValoreBooks, you can sell your used stuff for cash! You can sell textbooks, CDs, movies, video games, iPads, and iPhones. Online quotes are instant, shipping is free, and sell back prices are the highest in the industry. It’s an easy way to make money by cleaning out your closet, entertainment system, or bookshelf.
Using SmarterBucks, you can earn rewards that automatically become extra student loan payments used to pay down any student loan faster and for less. Signing up is free and rewards are easy to earn. Shop with your favorite brands, take surveys, sell your used stuff, and more!
5. Don’t forget SimpleTuition!
Every time you need a private student loan, be sure to compare your options and find the best loan for you. Finding the best interest rate possible can save you thousands of dollars over the lifetime of your debt. So if you’re still in school or are considering going back, let us help you get educated for less.
Getting educated is hard work. Unfortunately paying for it is even harder. That’s why summer is a good time to replenish your bank account. And yes, we know it’s only March. But planning ahead is the best way to secure summer employment. Here are tips to help:
1. Apply early.
There’s one mantra to remember when looking for a summer job: the earlier you apply, the better. Most students are looking for summer jobs and there may not be enough for everyone.
2. Take advantage of the seasonal hiring surge.
Many restaurants, resorts, camps, and parks need students for temporary summer positions. Take advantage of that hiring surge by applying at these places first.
3. Know where else to look.
Summer means lots of people are leaving on vacation, which means there may be a lot of part-time or temporary work available. Check with libraries, banks, and your own college campus for opportunities.
Tell people you’re actively looking for work, whether that’s your parents, your parents’ friends, your professors, guidance counselors, or any other adult in your life. They may know of availabilities. And better yet, they may serve as a reference, which is especially important if you haven’t had a job before.
5. Practice interviews ahead of time.
Interviews can be stressful. That’s why you should practice ahead of time. Have your parents or friends ask you questions while you answer them on the fly. Also consider asking a teacher or guidance counselor to help if you’re looking for more realistic preparation. Check out this blog post to learn how to ace odd interview questions you might be asked!
Good luck and happy searching!