Regardless of the decision which course of study it should take, at which university and in which city, the question of student financing arises for many people and in many cases a loan is used. But which loans are best for student financing?
The Federal financial aid
First of all there is of course the Federal financial aid (Federal Training Promotion Act). If you have the opportunity to finance your studies along this path, you should be aware of them in almost all cases. It is unlikely that you get better terms from a bank or a regular provider.
A prerequisite for Federal financial aid is that parents do not earn too much money, otherwise they have to finance their studies. But what if the Federal financial aid simply is not enough, because you live in a relatively expensive city, for example? Or if extra purchases have to be made that exceed the budget?
We have found additional opportunities besides the Federal financial aid, to finance the study and to increase its finances.
When it comes to rather small or medium-sized purchases, such as a boost of new literature or a laptop, especially small and mini credits can be worthwhile. These are not only quickly applied for and paid off, but in many cases also cheaper than the traditional disposition on the checking account.
For permanent or longer-term financing
When it comes to bigger credit, which should help to finance the study in the longer term, it is not always the same providers who are in favor of small loans.
Risks of financing studies by credit
Whether you can really talk about risks is questionable, but of course students have to be aware of what it means to finance their studies with a loan – and that you just get out of college with a loan that you still have to pay off.
With virtually all providers, the repayment starts some time after the end of the payout period. It does not matter if you are still studying, unemployed or have little money. A deferral is difficult to impossible. And a reduction of the rates is possible only in a few exceptional cases. You should plan well here in any case.
In addition to Federal financial aid and classic loans, there are other ways to finance or facilitate the study.
Scholarships as an alternative
Another alternative for students who do not have to repay money at all is through scholarships. However, these are of course limited and bring many conditions with it. For example, there are scholarships that are aimed primarily at particularly strong students or people from difficult social backgrounds. Also, those who are socially engaged may have a chance on a scholarship.
In all cases, you should be prepared to report progress on a regular basis, otherwise you risk losing the scholarship.
The education loan, like the Federal financial aid, is a state benefit that is usually used in addition to the Federal financial aid. However, it can also be used independently of this and can offer a low-interest alternative to other loans.
Conclusion on student financing with credit
As mentioned above, the student loan should, if possible, be regulated by the Federal financial aid. But even if this is not feasible, other options remain. One should be very sure that the study is also terminated, because the credit must be repaid in any case, after the study is completed – even if no degree has been achieved.