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Find Out the Best Time to Apply for Student Loans

Paying for college can be incredibly stressful for both students and parents to deal with. There are so many different types of loans, scholarships, and federal aid available so it's important you understand all your options. 

Private student loans may seem attractive, but they can come with high interest rates and cannot be forgiven by the government in the future. So, before applying for private student loans, you'll want to ensure you've exhausted all of the other resources available to you.

Steps you should take before applying for private student loans

When figuring out your loan payment plan for college, it's important to exhaust all your resources before applying for private student loans. Private loans accrue interest while you're still in school and often have higher interest rates unless you have a qualified cosigner. 

To make sure you save the most money, you'll want to follow these steps before applying for private student aid: 

  • Apply for financial aid and federal student loans 

  • Apply for as many scholarships and grants as possible 

  • Talk to your school's financial aid office 

  • Apply for private loans to cover the rest of your tuition

1. Apply for financial aid and federal student loans

If you haven't already filled out your Free Application for Federal Student Aid (FAFSA), let's quickly review why it should be your first order of business. Once your FAFSA form has been processed and approved, the school you plan on attending will send you an award letter with the amount of money they can offer. You'll need to fill out this form prior to each school year. 

This award letter may include items from the federal government such as grants, federal subsidized or unsubsidized student loans, Parent PLUS loans, and work-study opportunities. Generally, these are awarded based on your or your family's financial need.

Grants, such as the Pell Grant, are the best form of aid you can get since you don’t have to pay the money back.

Federal subsidized and unsubsidized loans are next on the list. These loans are offered by the U.S. Department of Education and often come with low interest rates. Plus, if you score a subsidized student loan, the government pays the interest on the loan while you’re in school. 

If you have time to work and you’re offered a work-study position, the income you receive from your on-campus job can help cover your college costs. 

2. Apply for scholarships and grants

The next step you should take before applying for private student loan programs is to explore grand and scholarship opportunities throughout your community. These are available to high school students, recent high school graduates, or current college students.

You can find scholarships with various requirements through your school, the government, or other privately funded organizations. While some scholarships require essays, the time you put into them can greatly benefit you in the future and save you money. 

3. Talk to your school's financial aid office

Before making any plans to apply for student loans, you should talk to your school's financial aid office. They can provide you with resources and programs to help you get the aid you need. In some cases, both graduate students and undergraduate students may be able to negotiate your cost of attendance for the academic year.

4. Apply for private student loans

Federal student aid and scholarships may sound like enough to cover the cost of college, but far too often, the amount you are eligible for doesn’t cover your total costs.

That’s where private student loans can help. 

Private student loans are offered by banks and independent lending institutions, which have their own requirements for approval and loan terms. However, your loan application approval may be dependent on a hard credit check. Private lenders and credit unions will look at a borrower's credit history to determine your eligibility for a loan. 

Private loans vs. federal loans: What's the difference?

Before applying for any student loans, it is also important to understand the different types of student loans on the market. For student loans, everything will fall into two basic categories: Federal Loans and Private Loans.

The biggest difference between the two loan types is that one has a private loan lender and the other is borrowed from the federal government. Additionally, they each have unique repayment options. 

Federal student loans will qualify for federal student aid programs and student loan forgiveness. Additionally, your loans can easily be put into deferment if you cannot afford to pay your monthly payments right after graduation. The main downside is that the federal government will not allow you to refinance federal loans at a lower interest rate. However, you can refinance your federal loans with a private lender after consolidation. 

Private loans will start accruing interest while you are still in school, but your repayment plan will not start until after graduation. If you have a cosigner with a high credit score, you may be able to secure lower interest rates on private loans as well. 

Frequently Asked Questions

Can you still get student loans if you go to school half-time instead of full-time?

To qualify for federal direct subsidized loans or federal direct unsubsidized loans, you need to be in school at least half-time. Enrollment requirements qualify half-time school as taking at least six credit hours.

However, you can take a lighter course load if you are taking out loans from a private lender. 

What is the difference between fixed and variable rates?

The key difference between fixed and variable interest rates is that fixed rates stay the same throughout your loan term, while variable rates can change. 

Who is the best private lender for student loans?

When applying for higher education student loans, there are a lot of private lenders available to you. However, Nitro has a list of trusted loan advisors you can apply to directly. See the full list of our favorite private lenders

Take the stress out of planning for school with Nitro

Figuring out how to pay your college tuition in the best way can be extremely difficult. With so many loan options on the market, it can feel overwhelming too. Luckily, Nitro has broken down everything you need to know about applying to school, paying for it, and loan repayment after graduation. 

Whether you are applying to colleges, are a current student, or already graduated, we have something helpful for everyone. Covering topics from student loan forgiveness to the best online colleges and universities, we want to make sure your college experience is stress free.

If you’re unsure about where to start, check out our picks for The Best Private Student Loans of 2022.


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