Apply for low-dollar scholarships . Not many students apply for these , so you ’ ll have a greater chance of receiving the scholarship .
Work while you ’ re in school . It may be difficult , but no one said the college experience would be easy .
Choose an affordable school . Don ’ t let prestige cloud your decision . And parents , be sure to have an open conversation with your student about what ' s affordable .
pay the way college costs
Student
When you take out a loan , you end up paying more than you borrow . Make sure you look at all your other options .
The payments for this loan will fall to your parent if you fail to pay , which will add to their stress . Knowing that ’ s a possibility will add to yours .
It may damage your relationship with your parent . If they ’ re constantly talking about finances , how long before you decide they ’ re just nagging ?
Cosigning a Student Loan
33 % of cosigners say they didn ’ t fully understand the risks when they agreed to cosign .
You can ’ t place a price on your education — but colleges certainly can ! High tuition costs can have you considering some high-dollar student loans , which may require a cosigner . Turning to mom and dad might be your first instinct for a signature , but do you know what you ’ re signing up for ? Do they ?
What to consider when cosigning a student loan :
Parent
If your child is late on a payment ( or misses one completely ,) your credit will suffer .
Being attached to this loan will increase your debt-to-income ratio , which may negatively impact your ability to take out mortgages or other loans .
Remember : your student can pay for school with grants and scholarships , but you can ’ t take out a loan for your retirement !
Consider what happens if you don ’ t graduate- you ’ ll still be responsible for paying back the money you borrowed !
Don ’ t count on a cosigner release to get out from under your student ’ s debt ; they are very difficult to obtain .
The Worst Possible Scenario According to The Student Loan Sherpa , “ If a borrower dies or becomes permanently disabled , it does not necessarily mean that the cosigner is off the hook . It is critical to understand the terms of the loan agreement and , if necessary , to have a life insurance policy in place to protect the borrower or the cosigner .” www . thestudentloansherpa . com
No one wants to borrow all that money , so it may be time to look into some alternative options :
Apply for low-dollar scholarships . Not many students apply for these , so you ’ ll have a greater chance of receiving the scholarship .
Work while you ’ re in school . It may be difficult , but no one said the college experience would be easy .
Choose an affordable school . Don ’ t let prestige cloud your decision . And parents , be sure to have an open conversation with your student about what ' s affordable .
24 | Spring 2018 www . potentialmagazine . com