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In just a few months, college campuses across Virginia’s Blue Ridge region and beyond will be abuzz with their incoming freshman classes. Students will be wide-eyed with excitement – but they and their families also may widen their eyes at the sight of their tuition bill.
By now, many students have received their financial award letters. While it is important to exhaust financial aid, especially “free money” like grants, before looking at other financing options, some students will see a significant gap between their aid amount and their school’s cost of attendance. Below are five ways these students and/or their families can potentially cover that gap.
This one may seem obvious, but many students simply assume they will not qualify for scholarships. The fact is that not every scholarship opportunity requires a perfect GPA or varsity-level athletic experience. There are scholarships for students based on community service, involvement with a church or other religious group, artistic or musical talents and even particular hobbies (including some more unusual ones like duck-calling). Fastweb.com lists a broad variety of opportunities and is a good place to start your search for “free money.”
You have heard of internships where students trade (usually) unpaid labor for work experience and college credit. But have you considered a cooperative education program? Cooperative education students earn academic credit and wages while working for outside employers as part of a structured degree program. These programs typically require one to three practical learning experiences, which may be full-time and can last from three to 12 months. As a bonus, some colleges do not bill tuition for terms the student works full-time. Here in this state, Virginia Commonwealth University and Virginia Tech both offer cooperative education opportunities degrees.
A PLUS loan is a type of federal loan that allows parents to borrow money for paying their child’s tuition. The amount of the loan, determined by the school, can cover the difference between the student’s cost of attendance and any other financial aid received. Unlike federal educational loans taken out in the student’s name, PLUS loans require a credit check, and they carry a higher interest rate than student loans. Keep in mind that parents who take out these loans are responsible for paying them in full, whether their child successfully graduates or not.
A home equity loan allows homeowners to borrow against the equity in their house. This type of loan can be used to finance college, and for parents who are helping their child pay for school, there are two potential advantages over the Parent PLUS loan. First, because you can shop around with different lenders to find the best rate, you may be able to pay significantly less interest on a home equity loan compared to a PLUS loan. Second, while the school sets the amount you can borrow with a PLUS Loan, a home equity loan amount is based on the equity you’ve earned. Lenders typically allow a borrower to take out 80 to 85 percent of the home’s value, but some lenders will loan up to 100 percent. It is important to note that the home is collateral for this type of loan, so potential borrowers need to consider their financial situation carefully and have a detailed repayment plan in place.
This option may be for any student of any age who plans to work at least part-time through college. Employee tuition assistance programs vary from one workplace to the next—for example, some may be exclusively for full-time employees, and some may only cover strictly work-related courses. But, it’s certainly an avenue worth exploring for working students. Employers in Virginia that offer tuition assistance include Best Buy, Verizon, and Wegmans Food Markets.
Covering the costs may rank right up with final exams as the least exciting aspect of college—but students and their families have options, and it is important to explore each carefully. Consider it your first college homework assignment!