When you applied to college, you knew it was going to be expensive. For many students, paying for the cost of their college education out of pocket just isn’t an option.
Many turn to financial aid to fill the gap between what they can afford and the cost of tuition—the U.S. Department of Education awarded more than $120 billion in grants, work-study, federal student loans in 2018. So, you fill out the Free Application for Federal Student Aid (FAFSAⓇ) every year and plan on receiving a financial aid package that might help you make ends meet as you work your way to your degree.
Have you ever thought about what would happen if you lost your financial aid? Losing financial aid in college might be a stressful experience, but it doesn’t mean you have to give up your dream of getting a degree.
Federal student loans and grants aren’t the only way to pay for college, and knowing what options are out there could help you continue your college education without skipping a beat.
Losing Your Financial Aid
To qualify for federal student aid, you must meet specific eligibility requirements outlined by the U.S. Department of Education. While most college students don’t have a problem meeting them, there’s no guarantee you’ll maintain eligibility through the entirety of your college career. Requirements include:
• Demonstrating financial need
• Being a U.S. citizen or eligible noncitizen
• A valid Social Security number
• Enrollment as a regular student in an eligible degree or certificate program
• Demonstrating that you’re eligible to pursue higher education by showing a high school diploma or completion of other qualifying schooling
If you don’t meet one or more of these requirements at any time, you may potentially lose your financial aid. While it could be possible to gain that eligibility back, you may need to find other ways to pay for school in the meantime.
Paying for College
Whether you’re no longer eligible for financial aid or you weren’t eligible to begin with, there are several options that could help cover your education costs.
1. Applying for Scholarships
Most universities offer academic scholarships to students who meet certain minimum GPA requirements. If you’ve done well in school so far, you may qualify. If you’re already in a program, you may also have access to scholarships available only to students in your major.
You could speak with a financial aid counselor at your school or visit the college’s scholarship page on its website to find out what’s available.
Also, many private companies and organizations offer scholarships to diligent students. Websites like Scholarships.com , Fastweb , and College Board allow you to search for scholarships and even provide tips on how to improve your chances of getting one.
2. Getting a Job
Working even part-time while taking classes might sound like a surefire way to kill your social life or induce sleep deprivation. But after losing financial aid, it may be essential to staying in school.
Many colleges have on-campus jobs that allow you to work without needing to stray too far away. And in fact, some financial aid packages include work-study, which is often an on-campus job that can help you earn money toward your tuition and other school fees.
Being awarded work-study doesn’t guarantee you a job through your school or local community, but it typically helps you secure placement and a specific number of working hours consistent with your award. But if your school has thousands of students, the competition can be fierce. If you have a car or access to public transportation, you could consider looking off-campus. As you expand your search, you might want to compare wages, hours, and other benefits.
3. Seeking Help From Family
If you have a supportive family situation and your parents can help you without putting their own financial situation in jeopardy, it may be worth asking for assistance. They don’t necessarily need to cover your tuition costs for you.
Instead, they may be able to provide you with a place to live rent-free, or you could ask for a loan with clear terms for repayment. Whatever you do, you might want to be mindful of your parents’ or other family members’ needs and don’t assume you’ll receive help.
4. Considering Transferring
Depending on the cost of tuition and the amount of financial aid you lost, it might be worth transferring to a less expensive college to save on costs. While that won’t pay for your tuition on its own, it may give you access to more scholarship and grant opportunities.
5. Applying for Private Student Loans
While federal loans often carry lower interest rates and more benefits than private student loans, the latter can still be an option if you fall short with the alternatives, whether you’re an undergraduate or graduate student.
Several banks, credit unions, and online lenders offer private student loans. As a result, you might want to shop around to make sure you get the best terms for your needs.
Also, unlike most federal student loans, private student loans typically require a credit check. And unless you have a strong credit history, a reliable source of income, and can meet other lender requirements, you may have a hard time getting approved. Again, if you have supportive parents, another option is to ask them to co-sign a private student loan with you.
Getting Financial Aid Back After Suspension
If you’ve lost your eligibility , the decision isn’t necessarily final. For example, if you’ve defaulted on a federal loan, you may be able to regain your eligibility once you get the loan out of default.
Whatever the reason, you could talk with your school’s financial aid office and find out what you need to do to get it back. It may take some time, but it can be well worth it, especially if you have a few years left in school.
Practicing Smart Student Loan Habits
Before you borrow, for instance, you could make sure you’ve exhausted all of your other options to get money to pay for school, including getting a job and applying for scholarships and grants. Also, you could avoid borrowing more than you need to limit how much you’ll owe in the long run.
As you get closer to graduation, you might consider refinancing your student loans once your credit and income are in good shape. Refinancing could potentially help you score a lower monthly payment, a lower interest rate, or both.
Know that if you refinance federal loans, you’ll no longer be eligible for programs like Public Service Loan Forgiveness, income-driven repayment plans or other federal benefits. To see what your new refinanced student loan could look like, take a look at our student loan refinance calculator.
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.
SoFi Loan Products
SoFi loans are originated by SoFi Lending Corp (dba SoFi), a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license # 6054612; NMLS # 1121636 . For additional product-specific legal and licensing information, see SoFi.com/legal.
SoFi Student Loan Refinance
IF YOU ARE LOOKING TO REFINANCE FEDERAL STUDENT LOANS PLEASE BE AWARE OF RECENT LEGISLATIVE CHANGES THAT HAVE SUSPENDED ALL FEDERAL STUDENT LOAN PAYMENTS AND WAIVED INTEREST CHARGES ON FEDERALLY HELD LOANS UNTIL THE END OF SEPTEMBER DUE TO COVID-19. PLEASE CAREFULLY CONSIDER THESE CHANGES BEFORE REFINANCING FEDERALLY HELD LOANS WITH SOFI, SINCE IN DOING SO YOU WILL NO LONGER QUALIFY FOR THE FEDERAL LOAN PAYMENT SUSPENSION, INTEREST WAIVER, OR ANY OTHER CURRENT OR FUTURE BENEFITS APPLICABLE TO FEDERAL LOANS. CLICK HERE FOR MORE INFORMATION.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income-Driven Repayment plans, including Income-Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.
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 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.