Scholarships are a money-based award to be applied to education-related expenses. They do not need to be repaid over time. Not all students will qualify for scholarships, however, as certain criteria must be met prior to applying. Most scholarships are awarded to students based on merit, talent, or academic performance. They are available through a wide variety of sources, including private schools, non-profit organizations, foundations, and private businesses.
School-offered scholarships are generally provided to gifted students, as well as those in low-income families. In fact, many private institutions offer more aid than is expected. You should contact your chosen school’s administration department for specific financial aid information. Outside scholarships may be harder to find, but usually offer aid to students who are academically talented, students from low-income families, and student minorities.
Loans consist of money that is borrowed and must be paid back within a certain time frame. They also accrue interest, which must be repaid. Loans are available to everyone with acceptable credit but may not be granted if the requester cannot demonstrate an ability to pay the loan back. It is possible, however, to qualify for a loan with a cosigner, or other creditworthy individual who agrees to share repayment responsibility.
What to Think About When Considering?
If you think a K-12 loan is a good option for you and your family, there are several factors you should consider when looking for one. Keep the following in mind:
Length of Terms
The longer your term, the lower your monthly payments will be. It is important to realize, however, that a longer loan term also means you will ultimately pay more back to the lender over time. This is because interest is continually accruing on the amount you borrowed; the faster you pay off the loan, the less you will pay your lender in interest. You must keep this in mind when deciding whether or not to take out a new private school loan with a long repayment term each year.
As previously state, most K-12 private school loans have relatively low interest rates. Exact amounts will, of course, vary depending on the lender you select, your income, and your financial history. The specific rate offered is largely based on your credit score; individuals with poor credit can end up with significantly higher interest rates than those with a good credit score.
It is also important to distinguish between a variable and fixed rate loan. While variable interest rates, also known as floating rates, are generally lower in the beginning, they fluctuate over time to correspond with financial trends. An increase in your rate will make your monthly payments, and total amount due, go up. Fixed rate loans, on the other hand, have interest rates that do not change throughout the life of the loan. You will pay the same amount each month until the loan is completely paid off.
Not everyone is eligible to receive a K-12 loan. Most lenders have established eligibility requirements that applicants must meet before qualifying.
- United States Citizenship
- Proof of stable income
- Good credit score
- Student admittance to a online payday IL licensed or accredited private institution
- Private school certification, enrollment agreement, or tuition bill
If you do not personally qualify for a K-12 loan, you may still be able to request funding. Most lenders will accept applications with a creditworthy cosigner. Cosigners become responsible for the loan in the event that the primary borrower is unable to continue making payments. In this situation, you may be able to ask a relative or close friend for assistance.