SPECIAL SECTION:
EDUCATION
not enough. Student loans provide financial
assistance for students to cover the costs
associated with attending a college or career
school, including tuition, supplies, books,
and living expenses. There are several types
of loans available including need-based, non-
need-based, state, and private.
Need-based loans are provided to students
who are unable to pay the amount needed
to cover all costs to attend college. Need
is determined by the Free Application for
Federal Student Aid (FAFSA), which can
be completed online, as the name suggests,
for free! Need-based loans are available as a
Federal Perkins Loan, awarded to students
with the highest need, or a Federal Direct
Subsidized Loan, provided interest-free while
in college.
If FAFSA determines that a student is
ineligible for a need-based loan, non-need-
based loan options are available as a Federal
Direct Unsubsidized Loan or Federal Direct
PLUS Loan. Unsubsidized loans allow the
borrower to add interest to the total amount
borrowed after graduation, but beware, as
this leads to owing even more money when it
comes time to start paying off the loan. Direct
PLUS Loans provide graduate students or
parents the opportunity to borrow the total
cost of attending college, minus other financial
aid received.
Unlike the loans mentioned above that are
sponsored by the federal government, state
and private loans are sponsored by banks,
colleges, foundations, and state agencies. The
U.S. Department of Education manages all
college loans available by state and requires
students to be in-state residents or enrolled
in a college in that state. Private loans are an
option for borrowers but come with terms
and conditions that may not be as favorable
as federal loans. Private loans also require a
cosigner who is responsible for repaying the
money if the student fails to do so.
Continued on next page >
CARLYNTON-MONTOUR
❘
FALL 2019
31