Part IV: Cutting the cost of getting a college degree

Plan ahead if you hope to get a student loan.

The “credit crunch” has now spread from the mortgage industry into the student loan arena. Private lenders such as banks are raising the criteria for loans and becoming pickier about whom they lend to. Some lenders have either curtailed or completely stopped giving out student loans due to the higher risks of default. Also, the ability to sell these loans to investors, there by replenishing the supply of money available to lend, has dried up.
Sallie Mae, the largest lender of student loans reported a $1.6 billion lose during the last quarter of 2007. They are planning to set aside $700 million to cover possible defaults on loans in 2008. This means they will have less money to lend.
If you are planning to get a loan to cover next year’s tuition and fees for college apply as soon as possible. There is a chance that the lender you used last year is no longer offering student loans or has raised the criteria beyond your qualifications to obtain one.
The student loan that is the least expensive in the long run is one that is guaranteed by the federal government. It has a fixed interest rate that is usually quite low as opposed to private loans that are not fixed and the interest rate can adjust up to 19%.
Keep a close eye on your credit scores since many lenders have raised the required minimum score from 675 to 695. Borrowers who do not meet this standard are considered riskier and could end up paying additional fees ranging from 3% to 10% of the loan amount.
Line up a co-borrower with a good credit history just in case it will be needed to either obtain the loan or to avoid the additional “risk” fees.


Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Part III: cutting the cost of a college degree

Miscellaneous expenses. On top of the tuition, room and board, you will also be facing additional expenses during the school year. A moderate budget for miscellaneous expenses is estimated at approximately $4,800 per year. Below are a few tips on cutting the cost of unexpected expenses.
Textbooks: Students, on average, spend close to $1000 per year on textbooks. Purchasing used textbooks for around half the price of new ones can lighten this burden. The Internet services such as craigslist.org, Half.com, CampusBookSwap.com., or discount bookstores are good places to start your search. Before purchasing make sure you have all the information on the textbook you are looking for, such as author’s name, title, and international standard book number (ISBN). The most expensive months of the year for buying textbooks are January, February, August, and September and the least expensive time is mid-semester. If you know which classes you will be taking for the next semester, buy your book during the months of lowest demand and cheapest prices.
Treat your textbooks with care so that when the time comes for you to resell, they will be purchased. Books with torn pages or broken bindings are nearly impossible to sell. If you were able to sell the used textbook for half of what you paid, you would have an overall savings of approximately 75%.
Cell phones: To avoid being shocked each month by your phone bill, shop around for cell-phone plans with a set monthly fee or offers enough minutes per month to meet your needs. BillSaver.com and MyRatePlan.com are useful when comparing cell-phone plans. Above all make sure the plan you choose provides service on your college campus.
Transportation: Between gas, parking passes, and general upkeep of a car you will be spending an enormous amount each year. Your best bet is to leave your car at home. Public transportation can be utilized if you need to go off campus and walking to your classes can be beneficial to your health.


Watch for part IV coming soon.


Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Part II: Cutting the cost of a college degree

Reduce the cost of your first two years of college by half. Take a closer look at the community colleges in your area. Many have what is called an “articulation agreement” with certain universities or 4-year colleges. In other words, the four-year college or university has agreed to allow the transfer of all credit hours from the community college towards a bachelor’s degree once the student transfers. In most cases, the student must keep their GPA above a certain level during the two years at the community college in order to qualify for the credit transfer. Some universities offer “merit scholarships” of $1000 to $2000 to students who carried a GPA of 3.3 and above.
The average yearly tuition at a community college is approximately $2,360 compared to $6,185 at a four-year college or university. Over the 2-year period, this will give you a savings of $7,650 in just tuition alone, not to mention, the additional savings from living at home as opposed to paying room and board at the university.
Summer classes. The more credits you can get through a community college the lower your costs will be for a bachelor’s degree. Even after you have transferred to the university or four-year college, you can take classes at your local community college. The average cost for each credit at the community colleges is less than $150 compared to $400 at a university or four-year college. Check to be sure the credits will be transferable before signing up for a class during the summer.
Start taking college class during high school. Some community colleges offer duel-enrollment to qualified juniors and seniors. The student earns their high school and college credits simultaneously. These programs are offered free of charge and the textbooks are loaned to the students by the college. This is the same as getting a 2-year scholarship and the savings is tremendous! Again, make sure most if not all the credits are transferable.

Watch for part III coming soon.


Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation

Part I: Cutting the cost of a college degree

Search for free money.

Federal Pell Grants. Grants from this program will not finance the full cost of a college degree, but they are helpful. The amount you receive can range from several hundred to several thousand dollars. The size of grant you receive depends upon your financial needs and the amount the college of your choice has received from the federal government for aiding students. They only receive a fixed amount for each school year so apply early because once the money is gone; it will not be replenished until the following year.
If you qualify for the Pell Grant and plan to major in math or science you could also receive additional money from the Academic competitiveness Grant or National SMART Grant.
State Grants. These grants are also based on your financial needs, but many states also use part of this money to encourage students into certain vocations such as teaching or nursing. If a state is experiencing a shortage of teachers or nurses many times they will offer an attractive incentive to students. Your full tuition or a large part of it will be paid by the state, if you are willing to work a predetermined amount of time in areas of the state with the greatest need for these services. How to apply for these grants can be found on the state’s web site under student-aid or higher-education commission.
Federal Supplemental Education Opportunity Grants. These grants are ear marked for low-income students so be sure to find out the maximum income allowed before applying. If you are living at home, income will be determined off the amount your parents make per year.
Institutional grants. Colleges and universities use these grants as incentives to attract the most desirable students. You cannot apply for these grants, but you can increase your chances of receiving one by applying to schools most likely to want you as a student.
To apply for a federal grant you will need to complete an application for Federal Student Aid. You can obtain this form from the college’s financial office, fill it out on line, or call the U.S. Department of Education at 1-800-433-3243 to have the form mailed to you.
January 1st is the earliest you can apply for the following school year. It is not unusual for the grant money to be used up by mid February so file as soon as possible.
The college, state, or federal grant agency may require additional forms and documentation. Your college’s financial aid office can help guide you through this process.

Watch for part II coming soon

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622