The amount you spend determines how much you’ll have to pay back. Loans should be the last stop in financial planning after you’ve received grants, scholarships, and federal aid and checked savings. To decide your loan amount, use this formula:
1. Add up your cost of attendance.
Your cost of attendance (COA) includes tuition and fees, room and board, transportation, books, and personal items throughout the year. It’s easier to plan for the school year instead of a single semester, because you should expect your COA to be the same.
2. Subtract your total in grants and scholarships.
These are gift aid—funds you don’t have to repay. If you’ve been offered work–study (money you can earn by working at a campus job), you may also be able to subtract those dollars from your costs, depending on how your school handles those offers.
3. Look into savings.
If you have savings, consider how much you can use to pay for college. Even $500 of your own money becomes $500 less you have to pay back with added interest. All VSAC Student Loans require a cosigner, so consider asking your cosigner and family and friends if they’re able to offer some additional money to keep the costs of your loan low.
4. Do the math.
If you still have a balance due after the first three steps, it’s time to look at loans. Remember that federal student loans should be your first choice because they offer flexible repayment options like Income-Based Repayment. Because there are loan limits for each academic year that you are in school, you may still need additional loan funds. Once you’ve exhausted all your free aid and federal student loan options, compare federal parent loans and private lenders like VSAC.