Student Loans - Do's and Don'ts

Applying for a student loan is easy, and so is getting it; where the challenge lies is in retaining and repaying it. Student loans are a great way to finance your education with reasonable interest rates geared specifically towards students. Student loans unlike scholarships do not have GPA requirements during schooling. However you do have to repay them unlike scholarships. So picking and choosing this long-term commitment requires attention to a few of the following details. This list helped me in paying for my pharmacy technician training without breaking the bank in the long run.

Planning and research: Looking into the best interest rates will go a long way in your ability to pay your student loans back in a timely manner. While the student loan is set up with a student in mind, it is only a loan nevertheless; it should be given the careful attention to detail that any other investment would. Applying for a loan without thorough research could be disastrous as the fine print may make all the difference. Knowing what your timeline is for repayment of the loan could make the difference between peace of mind and being hounded by collectors.

Keep your credit clean: Make sure that all of your credit cards are up to date with payments and don't cancel or change any loan terms during the period that you are applying for a student loan. Any major credit card purchases at this time will be a red flag to the student loan officer prompting an investigation and delaying the process.

Meet the deadline: Student loans have very strict deadlines. There is no wiggle room for an extra day or even an hour. Any missing information from your application can seriously delay the process making you ineligible for that semester. Some student loans run from one school year to the next, so missing a deadline can put you back as far as three semesters before you reapply.

Avoid private loans and equity loans: Private loans start accruing interest the moment they are taken out unlike student loans that give you six months to a year after graduation before you have to start paying them back. Private loans are not subsidized the way that student loans are and are not governed by principles that also keep the students’ best interests in mind. Equity loans put you at risk of losing your collateral in case you are unable to make your payments.

Importantly, borrow only what you need; remember that this is a loan and you need to pay it back (in my case on a pharmacy technician salary), even if the interest rates are lower than anywhere else you might find. While beginning one's career with a truck-load of debt may not be ideal, student loans will get you where you want to go while teaching you fiscal responsibility.