5 Essential Things You Need to Know Before Applying for a Student Loan

Estimated reading time: 4 mins

A Guest Post by Alex Moore

With the cost of college tuition rising steadily with every passing year, the importance of knowing just what goes into a student loan application process cannot be understated. The long-term financial ramifications of diving into any sort of loan can be disastrous, but going into debt before leaving college without a solid exit plan can lead to a decade or more of anxiety and stress that need not be endured.

Knowing what to expect when shopping around for a college loan is key to finding one that will fit your future self’s ability to pay it back. More important than that, however, is knowing the ins and outs of what a loan entails before diving in. If you’re curious about college loans or already have one looming overhead, here are five important facts to consider that could save you a lot of stress in the future.

1. Paying Back Your Loans Takes Longer than You Think

Any major financial commitment often takes longer to pay off than it might appear on the surface. After all, most students expect to enter the workplace to the tune of thirty thousand dollars a year at the very minimum yet many fail to take into account the average cost of living and just how much of that money goes towards taxes and other expenses.

With the majority of students holding debt into their forties, keeping a realistic view on payment schedules is key when approaching any loan, whether it be for school or otherwise. Just because your level of income is more than comfortable enough to support your lifestyle doesn’t mean you’ll have enough free money to put aside for loan payments while also accounting for healthy saving plans and sudden expenses.

2. The Price of College Isn’t Just Tuition

College tuition doesn’t account for the money you’ll need to get you through all four years of your average college stay. In fact, the average cost of tuition and fees can omit a serious percentage of your overall costs when you factor in room and board or even travel expenses if you choose not to live on campus.

With the average cost of room and board alone hovering near $10,000 for a four-year degree, there’s a fairly large disparity between the quoted cost of certain colleges and the fees you’ll actually pay for enrolling there. Books and supplies can further inflate that cost to the tune of several hundred dollars a semester.

3. Prepare for Your Loan Payments before They Come Due

For the average college graduate there is a six-month period after graduation in which your student loan is kept dormant. During this period of time you’re expected to find employment and settle into post-college life, which can be a trial in and of itself.

Desiree Marty shared her experience with U.S. News when it came to applying for federal loans and how life went once she left college in relation to her debt. In short, she reported payments of roughly $300 per month on a loan of $30,000 that began payments six months after she graduated.

She suggests preparing for this well ahead of time and knowing what your payment schedule will look like after you leave school so you may be better prepared for the financial burdens this implies. With many loans expecting to be repaid within ten years a quick bit of division can land you at your expected payments minus interest, so ensure your career will be able to support those payments over the long run.

4. Preparing for A Loan Should Start Early

To get the most out of college, as with most things in life, it pays to be prepared. You can offset some of the cost of your education by acting before you reach college age in a variety of fairly simple ways: apply for any college grants you think you may be eligible for, save money while in high school, and take advantage of tax breaks when you begin saving.

It may not take all of the pain out of loan payments but even saving a few thousand dollars before you reach college can cut as much as a year off of your loan repayment schedule.

5. Loans Don’t Just Go Away

Escaping debt as a student can be difficult to nigh-on impossible without a plan. Unlike other forms of debt, your college loan is unlikely to dissolve during bankruptcy and cannot be easily wiggled out of. Ensure you have the means to repay this debt before committing, or be sure you have the means for refinancing your student loans.

On a positive note, it is possible to work off certain amounts of your debt through teaching in low income areas or working in the humanitarian sector for a prescribed number of years, but this may cost you more time and effort over the long run than simply paying back your loan.


Knowing what to expect with a student loan is the first step in proper college preparation. It’s a potentially complicated process that can leave you with significant debt for a good portion of your adult life but the benefits that come with a degree can’t always be boiled down to a simple measure of finances.

Alex Moore is a lifestyle blogger interested in the utility of mutual help.
His interests include higher education and organizational efficiency and how these concepts can relate and help students. You’ll usually find him writing for www.jobapplicationcenter.com

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