The rules that govern your student loans and financial aid awards may seem opaque and even contradictory. Although there is a general legal framework that covers the disbursement and repayment of student loans, individual schools and lenders often enact their own policies and protocols on top of it. If you've attended multiple educational institutions or procured loans from multiple student lenders in the past, you've probably noticed that each organization has its own way of doing things. In order to navigate the treacherous waters of education financing, you must pay close attention to these rules and stay on top of all of your responsibilities and obligations.
Once you've obtained sufficient financing to cover your tuition costs for the coming semester or school year, you might imagine that you'll be "cut off" from receiving further loans or stipends. After all, your current loan burden has satisfied your immediate education-related debts. If you find that you still need to cover additional essential expenses like school supplies, rent, food and transportation, you might be gearing up to beg your parents or siblings for financial assistance.
You'll be pleasantly surprised to learn that you might be able to obtain additional loans to cover these miscellaneous costs. If you're committed to using only low-interest, federally-guaranteed student loans to finance your education-related expenses, you'll need to talk to your school's financial aid office. Based on your family's income, you'll be given a "financial aid award" that outlines the total amount that you're permitted to borrow.
In addition to your tuition expenses, this award also makes allowances for necessities like food, rent and transportation. In some cases, these additional allowances can add up to several thousand dollars. You can use federally-guaranteed loans like Parent PLUS and Stafford Loans to make up the difference. Most lenders will be happy to ensure that you're comfortable and well-fed during the coming school year.
If your financial aid award doesn't cover these additional expenses or seems inadequate to ensure that you're comfortable, you may be able to secure loans on the private market. Although there are plenty of private loans that are marketed as "student loans," such obligations have little in common with federally-guaranteed student loans. These credit facilities tend to come with higher rates of interest and stricter repayment schedules. Worse, they often begin to accrue interest as soon as they're issued. Before shouldering one of these expensive loans, you may wish to ask your school's financial aid office to reevaluate your award.