Federal student aid is a financial lifeline for college students. For the 2015-16 school year, the average undergraduate student received $14,460 in federal financial aid through grants, federal student loans, and educational tax credits and deductions.
To access these resources, college students must meet and maintain specific requirements. So what happens if you don’t and you lose federal financial aid eligibility? Find out how you can regain federal student aid eligibility, or how to pay for college if you can’t.
The Department of Education has clear guidelines for federal student aid eligibility. Students will need to meet these requirements to receive any financial aid.
There are the basic requirements for eligibility, such as U.S. citizenship and a Social Security number. There are also continuing requirements for federal financial aid eligibility:
As a college student, you should be aware of how your choices could cost you your federal student loan eligibility or access to grants and other aid.
If you don’t meet these guidelines, it can cost you access to federal student loans, grants, and more. And you’re left with far fewer ways to pay for college and cover their educational costs.
If you’ve relied on grants and federal student loans to pay for college, losing your federal financial aid eligibility could put your schooling in jeopardy. You’ll need to look into other options for paying for school. Here are some options.
First, you can try to fix the problem that is making you ineligible for federal aid or student loans. If you can resolve your eligibility issue, you might regain access to federal financial aid that you can use to cover costs.
In many cases, there are steps you can take to regain federal student aid eligibility. This could be relatively easy, as simple as correcting or filing a FAFSA. Or it could be a more involved process with a plan you’ll need months to complete.
If you’ve had your federal financial aid eligibility revoked by your school, sit down with someone in the financial aid department to review your options. They might be able to help you figure out what your options are and get you on the path to full eligibility once more.
You can also check the Federal Student Aid Office’s guidelines for regaining aid eligibility to see what your next steps would be.
If it looks like you won’t be able to get your financial aid eligibility back right away, you’ll need to think about your next steps for schooling.
Maybe you lost eligibility due to poor academic performance, for example. Many schools require that you show improvement and progress to regain your eligibility.
You’ll typically need to continue taking classes, but without financial aid eligibility, you won’t have access to loans or aid to pay for these costs. This can create a circular problem in which you need financial aid eligibility to afford to take more courses, but you cannot regain eligibility without taking more courses.
Depending on why you lost it, regaining eligibility can take a semester, or it can take more than a year. You’ll need to decide what to do about college in the mean time. Do you need to stop attending because you can’t afford it? Can you afford tuition if you switch to part-time attendance? Once you know your educational costs, you can start looking into your options to pay for them.
If you lose federal student loan eligibility, you might still be able to get private student loans to cover the costs. Private student loans differ from federal student loans in some key ways and aren’t always as advantageous for the borrower. However, without eligibility for federal student loans, they are your main loan option for educational costs.
One big difference is that private student lenders require students to meet certain lending requirements. Most lenders will want to see a credit score in the mid-600s or higher to approve you for a private student loan. Many will also factor in your income and employment history.
However, college students aren’t known for their stellar credit and high income. Many have just entered adulthood and are not yet financially established, and will have trouble qualifying for private student loans.
If this is you, consider getting a private student loan with a cosigner. A cosigner is a second person who is well-qualified for the loan and agrees to repay the debt if you default.
Of course, you can pay your college costs out of pocket, though working your way through college is less feasible than ever. With today’s higher college costs, a low-paying job won’t cut it, minimum wage simply hasn’t grown as fast as the costs of higher education.
You’ll need to earn enough to at least cover your college tuition and costs, and likely your living costs as well. Make it your mission to hunt down a college job that pays more than minimum wage.
Covering your costs out-of-pocket will also be more doable if you’re attending a low-cost college. If you can’t afford a full credit load, consider scaling back the number of credits you’re enrolled in each semester. If you’re paying for fewer credits at a time, it’ll be easier to come up with the cash to pay as you go. It will also free you up to work more hours.
Lastly, if you have one, turn to your safety net for help. If your parents can afford to help you without sacrificing their financial health, ask them for help paying for college. Remind them that they can write off your education costs they pay for on their taxes.
If cash to cover your costs isn’t an option, you can discuss other forms of support, such as:
Unfortunately, the answer to how to pay for college will likely never be an easy one to answer. Without federal financial aid, you’re left at the mercy of private lenders and parents. Work toward eligibility and in the meantime take your time to understand the pros and cons of your available options.