With college students returning to classes in droves over the coming days, many parents are still scrambling for ways to cover the cost of higher education. A tough economy and stiffer lending requirements is putting the squeeze on some families, forcing some people to turn to high interest rate credit cards to pay for tuition.
Even the age-old fall back, home equity, has fallen on hard times as housing prices plunge and 
parents find that what little money is available to them won’t pay for tuition or the interest rates being charged are causing some to pause.
Worse yet, are those lenders who’ve you dealt with in the past who are no longer writing student loans or have ceased business altogether. This has been especially challenging year for families looking to renew a relationship with a lender they like only to learn that it isn’t business as usual for them.
Searching For Student Aid
Even as classes get ready to start, it might not be too late to secure funding for the 2008-2009 academic year. You’ll have to move quickly though as the number of applicants is up while the number of lenders is down — private student loan lenders are definitely being stretched. Here are some tips to help you secure financing this year:
Search Around — Our sister site, SayStudent.com, offers excellent tips and advice on how to find private student loans. Download a free copy of the free Student Loan Aid Booklet to help you get organized and track what you need.
Consider PLUS Loans — PLUS loans or Parent Loan for Undergraduate Students allow you to borrow up to the full amount of college tuition minus any financial assistance. With a fixed APR of 8.5%, this rate is much lower than a credit card and slightly below what some private student loan lenders are charging. With a PLUS loan, just remember that you are responsible to repay it, not your student.
Contact Financial Aid — Your college’s financial aid office can help you out by sharing with you a list of recommended lenders. Be careful as some schools work closely with lenders receiving contributions from them in order to be included on their list. Shop around!
Payment Plans — Some schools will allow you to make payments over the coming academic year, understanding that students might be very limited when it comes to paying for their education. Usually offered interest fee, you may have to pay an administrative fee which is typically set at $50.
It certainly is a tough year for some families, requiring parents and students to work together to find a way to pay for education. If your financial condition has worsened since your child first entered school, you could be eligible for additional relief. Contact the college’s financial aid department to find what your options are.
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