Can I Use My Student Loan to Pay Rent
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Student loans encompass more than just tuition, fees, and books for school. You can also use them for other college-related costs — including living expenses.
Hither's what's y'all should know about educatee loans for living expenses:
- How to use pupil loans for living expenses
- What tin can student loans be used for?
- What shouldn't student loans be used for?
- What happens if you utilize pupil loans for something you shouldn't?
- Alternatives to using loans for living expenses
- What to do with leftover student loan money
- Often asked questions
How to utilise educatee loans for living expenses
If you need to cover your living expenses while attending college, it'due south a skillful thought to start by filling out the Free Application for Federal Educatee Aid (FAFSA). Your schoolhouse will utilize your FAFSA results to determine what federal student loans and other federal financial assist you lot qualify for.
As well be sure to accept advantage of whatever college scholarships and grants — since different pupil loans, these don't have to be repaid. There'southward no limit to how many of these yous can get, so apply for as many as yous might be eligible for.
Tip: Proceed in listen that it's normally best to take out federal student loans first if you accept to borrow for college. This is mainly because these loans come up with federal benefits and protections, such every bit access to income-driven repayment plans and student loan forgiveness programs.
After you've exhausted your scholarship, grant, and federal student loan options, private pupil loans can assist fill up any fiscal gaps left over. If you decide to have out a private student loan, exist sure to consider equally many lenders as possible to find the right loan for your needs.
This is easy with Apparent — you lot tin can compare your prequalified rates from our partner lenders in the table beneath in two minutes.
| Lender | Fixed Rates From (APR) | Variable Rates From (Apr) | Loan amounts | Loan terms (years) |
|---|---|---|---|---|
| Credible Rating View details | three.36%+ | 1.46%+ | $2,001 to $200,000 | 7 to 20 |
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| Credible Rating View details | 3.23%+1 | N/A | $1,000 to $350,000 (depending on degree) | 5, 10, 15 |
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| Credible Rating View details | ii.94%+2,3 | 0.94%+ii,three | $1,000 up to 100% of the schoolhouse-certified cost of omnipresence | v, 8, 10, 15 |
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| Credible Rating View details | 3.2%+ | 1.03%+ | $i,000 to $99,999 annually ($180,000 aggregate limit) | vii, 10, 15 |
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| Apparent Rating View details | 3.02%+seven | two.37%+7 | $1,000 to $200,000 | 7, 10, 15 |
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| Credible Rating View details | iii.33%+8 | i.69%+8 | $one,001 upwards to 100% of school certified cost of attendance | 5, 10, fifteen |
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| Credible Rating View details | 3.75%+ | Due north/A | $one,500 up to schoolhouse's certified cost of attendance less aid | 15 |
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| Credible Rating View details | iii.five% - 12.6% APR9 | i.thirteen% - 11.23% Apr9 | Up to 100% of the school-certified cost of attendance | xv |
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| your credit score. 100% gratuitous! | ||||
Learn More:
- Private Student Loans and COVID-nineteen: What You Need to Know
- Fed Loan Rates for '21-22 Schoolhouse Yr: What You Should Know
How pupil loans work for living expenses
Undergraduate, graduate, and professional person students are all able to employ educatee loans for living expenses. Student loan funds are typically disbursed directly to your school to cover tuition and fees. Whatever money left over volition be refunded to you lot, which you tin use to pay for housing and whatever other education-related costs.
Continue in mind that both federal and private educatee loans take their ain student loan requirements. To qualify for federal student loans, you must have financial demand and be enrolled at least one-half fourth dimension at an eligible school. With private educatee loans, you'll typically demand good credit and verifiable income to qualify — though exact requirements can vary by lender.
Tip: Some private lenders offer student loans for bad credit — but these loans tend to come with college interest rates compared to good credit loans.
If you're struggling to get canonical for a individual student loan, consider applying with a cosigner to improve your chances. Even if you don't need a cosigner to qualify, having one could get you a lower interest rate than yous'd get on your own.
Check Out: What to Practice If You're Denied a Student Loan With a Cosigner
What tin student loans be used for?
Before yous take out a federal or private student loan to help cover these costs, it'southward of import to consider how much that loan will price y'all in the time to come. This way, you tin be prepared for any added expenses.
You can find out how much you'll owe over the life of your federal or individual student loans using our student loan calculator below.
Enter your loan information to calculate how much yous could pay
? Enter the total corporeality borrowed $
? Enter your annual involvement charge per unit %
or
? Enter the corporeality of time you have to repay your loan years
With a $ loan, you will pay $ monthly and a full of $ in involvement over the life of your loan. Y'all volition pay a full of $ over the life of the loan, assuming y'all're making full payments while in school.
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Larn More: Taking Out Student Loans Without a Cosigner
What shouldn't pupil loans be used for?
While pupil loans can assistance cover quite a few expenses, keep in mind that you'll have to pay dorsum whatever yous borrow. Considering of this, it's important to borrow only what y'all need and so you lot tin can go along your hereafter repayment costs equally low equally possible.
For instance, some expenses y'all shouldn't use your student loans for include:
Check Out: Gap Years and COVID-xix: What Yous Demand to Know About Student Loans
What happens if you use student loans for something you lot shouldn't?
Financial assistance offices don't track exactly how students use their funds, so it'due south unlikely that you'll get in trouble for using your financial assist or student loans in cases where you shouldn't. Merely if you spend more money than what's budgeted in your schoolhouse's official toll of omnipresence, y'all could stop upwards with fewer funds than you demand to pay for other expenses — such as college textbooks or fees.
Additionally, if your fiscal aid office finds out that you've spent funds inappropriately, you could:
- Be reported to the Section of Education
- Have your funds taken dorsum retroactively
- Be responsible for paying back what you've already used to the school
At that place's also a slim possibility that you could be investigated and prosecuted for abusing student loan funds if your financial aid function finds out — so be sure to spend your funds appropriately.
Tip: Before you lot spend actress financial assistance or educatee loan money, enquire yourself whether the expense you're considering is something that you need for your teaching — such equally college housing or textbooks. If it isn't, it'southward best not to use the funds.
If you're worried that you've already used some of your funds in the wrong fashion, chalk it upward as a lesson for how not to spend funds in the future. You could also consider saving coin from a job or other income source to replace those funds.
Learn More: How Do Federal and Private Student Loans Piece of work?
Alternatives to using loans for living expenses
While student loans are 1 way to pay for living expenses, they aren't your only option. Here are a couple of other alternatives to consider:
-
- Employ for scholarships and grants: Because higher scholarships and grants don't have to be repaid, they can assist proceed your costs low while paying for living expenses. Yous might qualify for federal grants or school-based scholarships later on filling out the FAFSA. There are likewise many private scholarships and grants available from nonprofit organizations, local and national businesses, and professional associations in your field.
- Get a job. Working a part-fourth dimension task during college can assistance yous earn actress money for living expenses while likewise building your resume. You could as well consider applying for a job through a work-study program.
Other means to potentially lower your costs overall include:
- Ownership used textbooks or renting them
- Living off-campus and getting a roommate (or living at domicile if possible)
- Carpooling with a friend that has a similar schedule to you
Check Out: Tuition & Room and Board: On-Campus vs. Off-Campus Costs
What to do with leftover pupil loan money
It'south best to borrow only what you need to pay for school and related costs so you can avoid excessive pupil loan payments in the future. But if yous end up with actress federal or private student loan funds, there are a couple of ways to handle it:
- Pay it back. If you don't need all of your student loan money, you lot could pay it back to lower your overall loan balance. With federal student loans, you can cancel some or all of your disbursement within 120 days and return the money to your school.
- Save it for necessary expenses. If you have fluctuating or limited income, you might take a hard time getting the coin you need for rent or other necessities each month. Saving your extra loan funds for upcoming payments or expenses tin give you something to fall back on in case your other income doesn't come through. If you don't end up using the money, you can always pay it back toward your loans later on.
Just remember that you'll take to pay back whatever y'all borrow — so be sure to but go along your actress funds if you lot need to.
Learn More: How to Become Student Loans for Past-Due Tuition
Often asked questions
Here are the answers to several commonly asked questions regarding student loans for living expenses:
How can I alive off student loans?
You can use student loans for almost whatsoever instruction-related expense — pregnant you can potentially live on them. However, keep in mind that some loans come with pupil loan limits that volition determine how much y'all tin borrow.
Here are the undergraduate and graduate pupil loan limits you tin expect:
| Loan type | Loan limits |
|---|---|
| Directly Subsidized Loans | $iii,500 to $5,500 per year |
| Directly Unsubsidized Loans | Dependent undergrad: $5,500 to $7,500 per year ($31,000 total limit) Independent undergrad: $9,500 to $12,500 per school twelvemonth ($57,500 total limit) Graduate and professional: $20,500 per year |
| Direct PLUS Loans | Upward to the cost of attendance minus any other fiscal assistance received |
| Private pupil loans | Upwardly to the price of attendance (depending on the lender) |
Bank check Out: How to Get a Student Loan With No Credit Check
How do I get financial aid for living expenses?
To get financial aid for living expenses, you'll need to consummate the FAFSA. How much you'll receive in fiscal assist volition depend on several factors, including your school's price of attendance, your yr in school, and whether you're an independent or dependent educatee.
If you're a dependent student, it will also be afflicted by your Expected Family unit Contribution (EFC) — which is how much your family is expected to contribute toward your education.
Acquire More: How Long Does It Accept to Become a Educatee Loan?
How should students pay for monthly expenses?
There are several means you lot can pay for monthly costs as a student. For example, whatever extra financial assist or student loan money after your tuition is paid for will be refunded to you. You tin can then employ these funds to pay for rent or other monthly expenses.
Check Out: All-time Graduate Student Loans
Do student loans go to your bank business relationship?
This depends on how you've prepare your student account at your school. If yous've provided depository financial institution account data, you lot'll typically receive any leftover student loan money equally a direct deposit.
In other cases, your schoolhouse might transport you a check or deposit your funds on a prepaid debit card — however, these options could take longer compared to a bank deposit.
Learn More: Paying for Trade School: Fiscal Aid and Educatee Loans
Can I apply my student loan to purchase a machine?
By and large no — buying a auto doesn't fall under necessary didactics expenses, so you can't utilise a student loan for it. Withal, you could apply a educatee loan to help pay for gas or other transportation expenses.
Bank check Out: 4 Ideas for Building Credit as a College Student
Can I use my student loan to pay off credit cards?
If you've covered education expenses with a credit card while waiting for your student loan funds, you could pay off your carte du jour with those once you've received them. Simply in other cases, information technology could be considered an improper use of your student loan funds to pay off credit card debt.
Continue in mind: Using your student loan to pay off other debt could lead yous to need more educatee loans in the futurity — significant you lot could terminate up with more than debt than what you started with.
If you decide to accept out a private student loan for living expenses, remember to consider as many lenders as you can to find the right loan for you lot. This is like shooting fish in a barrel with Credible: You can compare your prequalified rates from multiple lenders in 2 minutes — without affecting your credit.
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Come across: 8 All-time Minor Student Loans
Jamie Immature contributed to the reporting of this article.
Source: https://www.credible.com/blog/student-loans/student-loans-living-expenses/
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