Iowa Student Loans
With a population of just over 3 million, Iowa is only the 30th largest state in the country in terms of population. Yet the Hawkeye State, once known primarily for its agricultural production, is home to some of the finest public, private, and religious educational institutions in the U.S. The state boasts three renowned public universities — the University of Iowa, Iowa State, and the University of Northern Iowa — as well as numerous baccalaureate colleges, master’s colleges, and specialized career institutes. Iowa also offers two law schools and two medical schools.
Iowa’s culture still reflects the state’s midwestern heritage, with its emphasis on hard work, family life, and stability. With its low crime rate and relatively small population, Iowa is known as one of the safest states in the nation. Yet communities like the capital city of Des Moines, Cedar Rapids, and Ames make the state a competitor in the fields of technology, scientific research, and the arts. If you’re considering a place to advance your education, Iowa combines the security of America’s Heartland with the excitement and diversity of some of the country’s top educational institutions.
Federal Student Aid
As you develop a plan for financing your education, remember that federal student loans are often the most affordable way to borrow money. The U.S. Department of Education issues loans at low fixed interest rates, with manageable repayment plans to help you repay your loans on time. Federal loans can often be consolidated, or combined into a single sum, to streamline the process of paying them off.
There are two major types of federal student loans: Direct Loans and Perkins Loans. You can apply for both types of loans by completing the Free Application for Federal Student Aid, or FAFSA. Perkins Loans, which are issued through post-secondary institutions using federal funds, are based on strong financial need and highly competitive.
Direct Loans, the most common type of federal loan, fall into four different categories:
- Direct Subsidized Loans: Based on financial need, these funds are available to undergraduates enrolled in colleges, universities, or specialized career programs.
- Direct Unsubsidized Loans: These loans are available to undergraduate or graduate students, and they are not based on financial need.
- Direct PLUS Loans: These funds are available to professional students, grad students, or to the parents of undergraduates who are still financially dependent.
- Direct Consolidation Loans: Consolidated Direct Loans can be paid off through a single monthly payment to one loan servicing company. If you have multiple federal loans, a Direct Consolidation Loan can make it easier to meet your financial obligations after you graduate.
In addition to student loans, the U.S. Department of Education issues grants and scholarships to qualifying students. Unlike loans, these awards do not have to be repaid. Federal Pell Grants, Teacher Education Assistance for College and Higher Education (TEACH) Grants, Iraq and Afghanistan Service Grants, and Federal Supplemental Educational Opportunity Grants (FSEOG) are the most popular forms of “free” federal aid.
Work-study jobs give you the opportunity to learn more about your chosen field while you earn money for academic costs or living expenses. Many public and private post-secondary schools offer work-study programs, which allow students to earn money for employment at a job related to their field of study. Like grants and scholarships, work-study funds do not have to be repaid.
Iowa Student Loan is non-profit corporation that has been in the business of helping students finance their education since 1979. This organization sponsors several private loan programs for college students. Private student loans can help fill the gap between grants, scholarships, work-study earnings, and savings, and the actual cost of attending college. Here are the three types of loans sponsored by Iowa Student Loan:
- Partnership Advance Education Loans: Partnership Loans are available to Iowa residents and non-residents. Borrowers must have at least one co-signer (a parent or other adult who guarantees that the loan will be repaid), unless they can pass a credit check on their own. There are three different payment plans available, which allow you to start paying off the loan right away, or to delay repayment until after you graduate. If you choose to start paying off your loan immediately, you can get lower interest rates and more favorable terms. If you decide to pay only interest while you’re in school or to defer payments completely until you graduate, your interest rates and fees may be higher.
- Iowa Alliance Private Student Loans: These loans are available to students who have been turned down for a private loan that requires a co-signer. To qualify, you must be a college student attending school (or accepted into a school) at least half-time. You must meet the criteria for satisfactory academic progress, and your credit must be approved by the lending institution. These loans require an origination fee, and interest rates are high compared with federal loans and many other private loans. Interest rates are not fixed, which means that they could be increased after you graduate. Both state residents and non-residents may apply.
- Iowa Private Student Loans: Several banks and credit unions in Iowa issue private student loans to help students fill in gaps in their college expenses. Interest rates, repayment terms, and eligibility criteria vary, so it’s important to compare offers from more than one lender. Iowa Student Loan acts as the servicer for these loans, helping borrowers find funding and manage their loan repayment. With loans issued by credit unions, the borrower and/or co-signer must become a member of the credit union in order to participate.
Because they must be repaid with interest, private loans should not be your primary source of funding. However, if you explore your options carefully and don’t borrow more than you can afford, private loans can be a useful tool for funding your education.
Iowa Grants and Scholarships
Whether you dream of attending a private college, a state university, a vocational school, or a professional program in Iowa, there are numerous grants and scholarships to help you reach your goals. Many of these programs are open to state residents only, so it’s important to review the eligibility requirements before you apply. Here are a few of the most popular programs:
- Iowa Tuition Grant: State residents seeking an undergraduate degree at a private college or university in Iowa may apply for these grants. The maximum award is $5,000 per year for up to four years. Full-time and part-time students may apply. The FAFSA serves as an application for this need-based award.
- All Iowa Opportunity Scholarship: Students must make satisfactory progress in school and demonstrate financial need to qualify for this program. Students must enroll in a participating college or university within two years after graduating from high school, and priority is given to students who graduated from alternative high schools. To apply, you must complete the FAFSA and the Iowa Financial Aid Application.
- GEAR UP Iowa Scholarship: This award is available to students who are part of the GEAR UP state cohort, a program sponsored by the Iowa College Student Aid Commission. This program provides awards of up to $1,300 per semester to Iowa state residents who attend an eligible post-secondary school in Iowa or out of state.
- Iowa Vocational-Technical Grant: Students enrolled in a technical or vocational school are eligible to receive up to $1,200 per year for up to two years if they qualify for this program. Only state residents who can demonstrate financial need are eligible.
- Iowa Barber and Cosmetology Arts and Sciences Grant: Students who aspire to enter these fields can qualify for up to $1,200 of financial aid. Eligible applicants must be state residents with strong financial need. These awards are made by the participating schools based on the student’s financial status.
- Iowa National Guard Educational Assistance Grant: Iowa students who serve in the Iowa Air or Army National Guard and who attend eligible schools in this state can apply for this grant. The maximum annual award is enough to cover the cost of tuition at one of the Iowa Regent Universities (Iowa State University, the University of Northern Iowa, and the University of Iowa).
- Robert D. Blue Scholarship: Awarded to students with outstanding scholastic abilities and strong moral character, these scholarships are worth up to $1,000. Students must be in high school or currently enrolled in an undergraduate program at an Iowa college or university to apply.
There are many other scholarship and grant programs available to students in the Hawkeye State. The more “free” financial aid you can put together to cover your expenses, the less debt you’ll have when you graduate from college and start your career.