AS A STUDENT, WHEN SHOULD I APPLY FOR A LOAN AND WHAT TYPE IS BEST?

In order to qualify and receive federal aid you first need to fill out the Free Application for Federal Student Aid (FAFSA). Complete and submit the FAFSA as soon as possible after January 1 of your senior year in high school. The FAFSA form should be available from your high school counselor or any college financial aid office. It's also available online.

Four to six weeks later, you'll receive a Student Aid Report (SAR) in the mail. Your preferred school(s) indicated on your FAFSA will also receive a copy of your SAR. Your preferred school(s) will then send you an award letter identifying the amount of financial aid you will be eligible for if you choose to attend that school.

If you need to take out a loan to cover your expenses, look into federal loans first. Low-interest loans such as the Federal Stafford Loan and Federal PLUS Loan (Parent Loan for Undergraduate Students) are guaranteed by the federal government and have excellent repayment terms.

The Free Application for Federal Student Aid (FAFSA)

Wachovia understands that preparing for a college education involves obtaining the right information in a timely manner. Wachovia is a source of information on financial aid and applying for education loans.

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Federal Stafford Loans

Federal Stafford Loans are available to students in subsidized and unsubsidized versions depending on your level of financial need. With a subsidized loan, the government pays the interest on your loan while you're enrolled in school, for six months after you leave college, and during periods of authorized deferment. If you don't qualify for the subsidized, then an unsubsidized version is available. With the unsubsidized loan, you are responsible for all interest that accrues while you are in school, in deferment, or during your grace period.

Eligibility for a Stafford Loan

• Enrolled at least half time at an eligible school and maintaining satisfactory academic progress
• A United States citizen or permanent resident of the U.S. or eligible trust territory
• Not currently in default or owing refunds on any Title IV loan or grant
• Registered with the Selective Service if you're a male under 25

Other Sources of Supplemental Funding

If your income makes it difficult to apply for basic financial aid, check into ROTC programs and National Merit Scholarships as ways to fill in the gaps. Work-study is also a way to reduce tuition costs or make a little extra income. Your school's financial aid office should be able to help you identify unconventional funding. Just remember to start early.

Scholarships and Grants

Always apply for scholarships and grants even if you think that you may not qualify. Any money that you can put toward your education that you don't have to pay back is money in the bank.

Pell Grants

The Pell Grant is based on financial needs and since many colleges require you to apply for a Pell first before other grants, go ahead and put it at the top of your to-do list.

Supplemental Education Opportunity Grant

These grants are also based upon financial need, except the money is distributed directly to the colleges. The colleges have control over how much money is awarded. Apply early for this grant because once the money is gone—it's gone.

Perkins Loan

Lets colleges act as lenders, and again, the loan is based upon need. Because the interest rates are low and the deferment period and repayment period are longer, applications usually exceed availability. Get your application in as early as possible to be considered.

Article: Federal and State College Financial Aid Programs

Wachovia Education Finance

The information provided in this Web site is not intended to be nor should it be construed as tax or legal advice. As with any tax planning matter or strategy, please consult with your attorney and/or tax advisor.

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