Taking Care of Business
Early last month, Congress passed a compromise proposal on student loan rates that will allow borrowers of new federal student loans to pay lower rates than last year. For the 2013-2014 school year, college undergraduates in financial need will qualify for Stafford loans with a 3.86% interest rate. Going forward, though, the loan percentages will be based on what is happening with rates on U.S. Treasury Bonds. So, as the economy improves, rates will increase. The bill also places a ceiling on the rates and permits borrowers to lock in interest rates over the 10 year life of the loan.
Potential borrowers can experiment with the timing of different interest rates and different levels of borrowing using the student loan calculator at Fin Aid. The Fin Aid website provides advice and links to sources of information about student aid. It covers loans, scholarships, military aid, federal and state aid, fellowships, grants, prepaid tuition plans, etc.
As college tuition costs continue to rise faster than inflation, more and more families are depending on scholarships and grants to finance higher education. According to the report “How America Pays for College 2013” released in August 2013 by Sallie Mae, grants and scholarships covered 30% of the total cost of college during the 2012-2013 academic year, more than any other type of funding including parent contributions and student loans.
To access grants and scholarships, students are required to fill out the Free Application for Federal Student Aid (FAFSA), which can be done online.
A searchable database of hundreds of thousands of scholarships, grants, loans and fellowships is available at Fast Web. Free registration on the Fat Web site supports setting up a personal profile in order to search for funding that matches a student's needs.
The Naperville Public LIbrary has prepared a Paying for College page on the library's website with these links and many more like them to assist LIbrary members in accessing useful information. Check it out!