What parents should know about student loan options

This article was written for our sponsor, NC Assist Loans.

For many graduating high school students, college is the next step on a path toward future careers. As a parent, the excitement of sending a child to college may come with concerns, including helping your child choose a college and a major that will fit their needs — not to mention paying for tuition, housing and all the other necessary costs.

In fact, paying for higher education is increasingly a major stressor for families, with nearly 70% of parents worried about covering the cost, especially in the midst of the pandemic. Luckily, understanding the resources available can help ensure your child is able to afford their school of choice and focus on learning.

Students from North Carolina and those attending school in North Carolina have several options when it comes to financial aid for their education. The first step is to fill out the Free Application for Federal Student Aid through the U.S. Department of Education. This will determine your child’s eligibility for federal aid, including grants and government-subsidized loans.

Completing the FAFSA will also connect your child to state aid that can be used at a local community college or any University of North Carolina institution.

Local loan program bridges the gap

Often, after your child combines scholarships, grants and any savings you or they have set aside for college, there still may not be enough to cover the cost of a college education. This is where the College Foundation of North Carolina’s NC Assist Loan comes in.

“The NC Assist Loan is an education loan that students can use to bridge the gap between the cost of college attendance and their existing financial aid,” said Brittany Privott, a regional representative with CFNC. “It’s open to North Carolina residents or students attending a North Carolina school. You can borrow up to the school’s cost of attendance, minus whatever other financial aid you’re eligible for.”

The NC Assist Loan is available for both parents and their children, meaning you can apply to pay for your child’s education or your child may apply. In some cases, a child may not have the necessary credit score or history needed to qualify, which is when a parent or another person can co-sign to guarantee repayment.

Regardless of what process you choose, the NC Assist Loan offers several benefits.

“This loan is an alternative loan, not a federal loan,” said Privott. “It has a fixed interest rate and no origination, application or guarantee fees. There are also no late fees or rejected payment fees.”

Interest will begin accruing from the beginning, but repayment doesn’t need to start until six months after your child leaves school or drops below half-time enrollment.

Estimating loan needs

While the loan can cover up to the total cost of attendance at a school, Privott recommends borrowing only as much as is needed. After all, the less debt after college, the better.

Additionally, the NC Assist program does not have a deadline, and you or your child can reapply each year to borrow money based on financial obligations at the time. The waiting time from loan approval to receiving the money is generally only a few days.

“The NC Student Assist website also has online resources for students to help them get an accurate picture of their financial needs,” said Privott.

The loan estimator for students and parents will help you determine what monthly payments could be, depending on the amount borrowed. In addition, the Smart Borrower Calculator estimates the value of your child’s future career compared to the cost of education.

“What you want to do in the future determines how much education you’ll need,” according to NC Assist. “When you finish your training or academic program, your job salary pays your bills, including any payments on student loans that you may have taken out to help pay for your education. That’s why smart borrowing should consider your future career and how much to borrow at the same time.”

This article was written for our sponsor, NC Assist Loans.