Why Apply for Federal Financial Aid?
For many college students, financial aid seems like a complex subject. Just like filing income tax returns, people dread the confusion of paperwork and deadlines. But try to remember what you effort is worth: free money. In fact, an afternoon's worth of online forms can equal thousands in cash for your college education.
According to the College Board's 2008-09 "Trends in Student Aid" report, over $180 billion in student aid was distributed through government funds, college funds, private funding sources, and federal tax credits. Currently, the Obama administration is working to ensure that the aid application process gets simpler and that the student need-analysis formula is clearer.
Still, some students aren't willing to do their federal aid homework. And it's costing them money. In 2007, 65% of undergraduates took no federal Stafford Loans, even though some were entitled to receive those federal funds. Instead, many borrowed from non-federal sources, like private banks and lenders. Unfortunately, the interest rates on private loans are higher, and repayment protections are fewer.
If you're heading back to college, read up on the following sources of federal aid. You might be surprised by how much funding you can receive.
- 1 What Are the Different Types of Federal Loans?
- 2 Who Qualifies to Receive Federal Loans?
- 3 How Do You Apply for and Receive Federal Aid?
- 4 Why Apply for a Private Loan?
- 5 How Do You Apply for a Private Loan?
- 5 How Common Are Private Loans?
- 6 Why Are Private Student Loans Less Desirable Than Federal Loans?