The content is accurate at the time of publication and is subject to change.
There are many courses, especially professional courses, which have very high course fees. A student with a moderate to poor financial background is often unable to afford the high course fees. Apart from the course fees, there are lots of expenses towards text books, laboratory fees, practical classes and stationery which could be quite high for some courses. A student might want to take an additional certification or external evaluation which often cost a lot. Then there are the non academic expenses which cannot be done away with - lodging, boarding, conveyance, laundry etc. Adding up all these expenses, it might so happen that the student doesn`t have enough money. It is during these times that a student might require financial aid.
A student looking for a job straight after college is usually not considered for most jobs because of his lack of prior work experience. Similarly, a student with no previous loans is unable to get a new loan because he has no credit history by which a prospective lender can assess his creditworthiness. There are no repayment histories, records of cheque bounces, statement of loans etc. on a car loan or home loan or personal loan which can give an idea about the worth of the student. In this case, no credit history is as bad as a poor credit history.
Many courses have the option of applying for grants and scholarships and if a needy student can get that then he might not need a loan at all. But if a loan is inevitable, the best way for a student is to apply jointly with a co-applicant who has a credit history. If the co-applicant has a credit score of 700 and above, then it increases the chances of his co-applicant getting a loan in spite of being a student with no credit history. But if he has no co-applicant, then he could try any one of the following five loans:
- Stafford Loans, which are designed for the poorest of poor students.
- Perkins Loan, which is a credit free aid package offered in campuses.
- State Student Loan Offers, which are handled by respective state governments.
- PLUS, which stands for Parent Loans for Undergraduate Students.
- School Certified Private Loans
A student must look into the comparative features and pricing of these five products according to the state he lives in and make his choice accordingly. He could either look into appropriate websites or ask people who have availed of these loans earlier.