10 Common Private Student Loan Application Mistakes to Avoid

Unfortunately, some student’s federal aid doesn’t cover the full cost of their tuition. Private student loans offer a solution. Private student loans have the ability to be used for tuition, books, supplies and housing fees.

It’s important to be aware of common private student loan application mistakes before submission.

Let’s take a look…

Mistake #1: Applying for private student loans first.

Some colleges and companies that offer scholarship awards require you to complete the FAFSA. The FASFA helps determine student’s scholarship eligibility. Make it a note to complete the Free Application for Federal Student Aid (FAFSA)!

Also, don’t assume your household makes too much money to receive federal assistance. You may be eligible for various types of federal aid such as grants or work-study programs.

Mistake #2: Failing to ask about tuition reimbursement.

Not every employer offers employer tuition assistance programs. Those that do, give eligible employees or their family members an average of $5,000. Those funds are for completing college-level coursework. This funding does not need to be repaid and can also help you graduate with less student loan debt.

To learn more, speak with the human resources department about application and eligibility details.

Mistake #3: Assuming college tuition is due in full.

Some colleges offer tuition installment plans. These plans may enable you to split your tuition balance into multiple payments with zero interest. In turn, the amount you need to borrow in student loans could be smaller.

Mistake #4: Forgetting to re-apply for scholarships.

Many college scholarships are awarded annually. Usually you have to submit a new application each academic year. If you miss the deadline, you may lose out on this source of free money. This may cause you the need to borrow more money. To avoid this, speak with a scholarship administrator to confirm when you should re-apply for your awards.

Mistake #5: Leaving blank spaces on applications.

Mark any question that doesn’t apply to you as “Not applicable” when filling out your application. Leaving blank answers makes your form incomplete. This could delay your funding approval. As a precaution, have a parent or a trusted individual review your applications.

Mistake #6: Submitting inaccurate information.

Don’t make the mistake of inputting an incorrect Social Security or driver’s license number. This major student loan application mistake could result in a loan denial. To avoid this, double-check your information. Additionally, it’s a good idea to have a trusted individual review your applications before submission.

Mistake #7: Providing false information.

Purposely providing incorrect information on a loan document can result in much more than a loan denial. It is considered fraud. Fraud is a crime that’s punishable under criminal and civil law.

Lenders know that some applicants try to use false information on the loan document. Financial institutions use various software programs to flag these false claims. Moreover, they confirm application information by using public records, credit reports, and employment verification services.

Mistake #8: Requesting a loan amount that exceeds the cost of attendance.

A private student loan has limits to the amount of money you can borrow. Some lenders require written confirmation of the federal awards you’ve already accepted. Others may speak with your school’s financial aid office. This further ensures that your loan request doesn’t exceed the cost of attendance.

Mistake #9: Forgetting that a cosigner can help with private student loan approval.

If you have little to no income or credit history, a cosigner can help you secure a private student loan. A cosigner allows the lender to consider their financial and credit information. It should be noted that a cosigner shares legal and financial responsibility for the loan.

Mistake #10: Waiting until the last minute to apply.

Choosing the right offer for your specific situation is important. Start your loan search early. This allows for ample time to compare interest rates and repayment terms. Rushing an application could cost you thousands of dollars over the life of the loan.

 

Low-interest rate private student loans offer a convenient way to borrow the funds you need for college. As a result, you’ll be able to pay for educational expenses when you’ve exhausted other financial aid sources. LendKey offers variable and fixed-rate private student loans to help you achieve your dreams of a higher education. Apply today!

 



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