If you’re attending a public university that is not in your home state, establishing residency could significantly reduce the tuition bill. However, establishing residency for the sole purpose of qualifying for in-state tuition can be difficult. Generally, you need to be financially independent, live in the state for at least a year, and demonstrate that you intend to stay in order to be considered a resident of a new state.
Read on for a closer look at what it takes to establish residency where you go to college, whether or not it’s worth the effort, plus other ways to get a break on out-of-state tuition at a public university.
Establishing Residency
Each state has their own requirements for establishing residency. Requirements can also vary based on the university, which can add confusion to the process. Here are some of the general requirements that states and universities often require to determine residency:
• Physical Presence Most states need you to be a resident for 12 consecutive months before you qualify for in-state tuition. The time to establish residency could be more or less, depending on the state.
• Intent Students generally must prove that they are living in a state for more reasons than just attending school.
• Financial Independence Typically, students must prove they are financially independent and no longer supported by their parents.
💡 Quick Tip: You can fund your education with a low-rate, no-fee private student loan that covers all school-certified costs.
3 Tips for Establishing Residency
Establishing residency can be difficult, but with these tips and a little legwork, you may be able to become a resident of the state where you go to college and, possibly, slash your tuition bill.
1. Relocate as Soon as Possible
Since most states require you to be a resident for 12 consecutive months, it makes sense to relocate as soon as you can. If you are currently enrolled in a school, and are hoping to establish residency, this could mean spending your summers on-campus or at the very least in that state. You may also need to rent or buy property, as well as pay income taxes in your new state.
In addition, you’ll likely have to cut ties to your home state and do things like change your voter registration.
2. Boost Your Reasons for Moving
You usually need to prove the reason you moved to the state wasn’t solely for getting in-state tuition.
There are a few things you can do to help prove intent:
• Get a new driver’s license
• Register a vehicle
• Get a state hunting and/or fishing license
• Open a local bank account
• Get a local library card
Having any of these things in your old state may make it more difficult to establish residency in your new state.
3. You May Have to Distance Yourself from Your Parents
One of the common requirements for establishing residency is financial independence. This can make establishing residency extremely difficult for students between the ages of 18 and 22 who are still being supported by their parents. Becoming an independent student before the age of 24 can be challenging, both logistically and emotionally.
You may already be an independent student if:
• You are married
• You are a veteran
• You have dependents of your own
• You are a legally emancipated minor
If you are a dependent student, it’s worth weighing the pros and cons of establishing residency on your own. It could mean delaying graduation and paying for college without any help from your family.
Alternatives to Establishing Residency
Establishing residency in a new state isn’t always the only option for getting in-state tuition. Some states participate in regional reciprocity agreements that let students attend colleges in bordering states at a discount.
Here are a few examples:
1. New England Regional Student Program
Run by the New England Board of Higher Education, this program allows New England residents to enroll in out-of-state New England public colleges and universities at a discount. To be eligible for the program, students must enroll in an approved major that is not offered by the public colleges and universities in their home state.
This program includes six states: Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont.
2. Midwest Student Exchange Program
Through the MSEP , public institutions agree to charge students no more than 150% of the in-state resident tuition rate for specific programs. Some private colleges and universities offer a 10% reduction on their tuition rates.
Participating states include: Illinois, Indiana, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, and Wisconsin. You can use its database to find colleges and universities participating in the program.
3. Southern Regional Education Board’s Academic Common Market
This program is similar to the New England Regional Student Program. It provides tuition-savings to students in the 16 SREB states who are interested in pursuing degrees that are not offered by their in-state institutions. Students are able to enroll in out-of-state institutions that offer their degree program, but they pay the in-state tuition rate.
Participating states include: Alabama, Arkansas, Delaware, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and West Virginia. You can use its database to find participating institutions.
4. Western Undergraduate Exchange
The Western Undergraduate Exchange is open to students from any of the 16 states that participate in the Western Interstate Commission for Higher Education (WICHE). The program allows students to enroll as nonresidents in more than 160 participating public colleges and universities and pay 150% (or less) of the enrolling school’s resident tuition.
Participating states and territories include: Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, North Dakota, Oregon, South Dakota, U.S. Pacific Territories and Freely Associated States, Utah, Washington, and Wyoming.
5. Exceptions for Students without Residency
Sometimes, residency rules are waived or are more lenient for students with special circumstances, including, veterans or the children of military personnel.
There is no single database of these exceptions, so if you think you may qualify for one, check with the colleges you are interested in to see whether there are any exceptions and how you can apply for them.
Recommended: What Is the Cost of Attendance in College?
Types of Student Loans to Help Students Pay for College
Even if you’re able to establish residency in a new state and qualify for in-state tuition, you still may need help paying for college. Scholarships, grants, and work-study are types of financial aid that are not required to be repaid. Beyond that, student loans are also an option. There are two major categories for student loans: federal and private.
Federal Student Loans for Undergraduate Students
Federal student loans are funded by the U.S. government and are subject to a set of standard rules and regulations. The interest rate on federal loans is fixed, which means it remains the same over the life of the loan. These interest rates are set annually by Congress.
There are two main types of federal student loans that may be available to undergraduate students — Direct Subsidized or Direct Unsubsidized Loans.
Direct Subsidized student loans are awarded based on financial need. The interest on these loans is paid for (or subsidized) by the U.S. Department of Education during the following periods:
• While the student is enrolled in school at least half-time
• During the loan’s grace period, which is usually the first six months after the borrower graduates or drops below half-time enrollment
• During qualifying periods of deferment, which is a period of time when loan payments are paused
Borrowers with unsubsidized loans are responsible for all of the interest that accrues on the loan, even while they are attending school
To apply for a federal student loan, students must fill out the Free Application for Federal Student Aid (FAFSA®). Students interested in receiving financial aid must submit the FAFSA each year.
Private Student Loans
Private student loans are borrowed directly from private lenders like banks or other financial institutions. These loans may have fixed or variable interest rates. Unlike the federal student loans available to undergraduate students, which do not require a credit check, private lenders will generally review a borrower’s credit history, among other factors, when making their lending decisions.
In general, you’ll want to consider private student loans only after you’ve tapped any federal loan options available to you. This is because private lenders do not offer the same protections — such as income-driven repayment plans — to borrowers.
💡 Quick Tip: Federal student loans carry an origination or processing fee (1.057% for Direct Subsidized and Unsubsidized loans first disbursed from Oct. 1, 2020, through Oct. 1, 2024). The fee is subtracted from your loan amount, which is why the amount disbursed is less than the amount you borrowed. That said, some private student loan lenders don’t charge an origination fee.
The Takeaway
Establishing residency can help a student qualify for in-state tuition, which could lead to a substantial savings in tuition costs. Unfortunately, establishing residency for the purpose of qualifying for in-state tuition, especially as a dependent student, can be challenging. Some states, however, have reciprocity agreements with other states, which allows you to benefit from lower tuition without establishing residency in a new state.
Whatever tuition you end up paying, there are resources that can help make the cost of going to college more manageable, including financial aid and federal and private student loans.
If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.
SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs.
SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SOIS0923004
