Whether you are looking to earn a degree while working full-time, study from the comfort of your home, or enroll at a distant college without having to travel, one thing is undeniable: online degrees have opened up a whole world of opportunities. But what are your options when it comes down to funding your studies? Will student loans be available to you?
After all, while more affordable than on-campus courses, online degrees come at an average cost of $51,091. Luckily, the short answer is yes, there are student loan options available to fund your distance learning journey. But there’s a little more to keep in mind – start here!
Federal Student Loans For Online Degrees
Tuition fees are a necessary evil to access your desired online degree course and kickstart your career. Luckily, thanks to the rising popularity of online and distance learning, you’ll find that today, applying for a student loan for an online degree isn’t that different from getting financial help for a campus-based course. And, it all starts from the FAFSA website.
FAFSA – or the Free Application for Federal Student Aid – is a program designed to help institutions understand how much a student can contribute to the college’s tuition fees, and how much financial help is needed based on their household’s income.
Today, most accredited online colleges will accept this form of need-based aid, and there are no income requirements you need to meet to apply. Here’s what to keep in mind when applying for a federal student loan:
There are different types of loans available depending on your circumstances, including Direct Subsidized or Unsubsidized Loans, Direct PLUS Loans, and Direct Consolidation Loans.
Your school, the state, and the federal financial aid program might set different deadlines for filing your applications, so keep an eye out for potential timeline differences.
Each year, FAFSA sets caps on the amount that can be borrowed, and the help provided might not cover 100% of your tuition or expenses.
Private Student Loans For Distance Learning
Private student loans are a valid alternative to federal financial aid programs. But they can also help you fill any financial gaps left from federal loans by financing 100% of your remaining needed amount.
Provided by independent institutions such as banks and private lenders, private loans offer some benefits worth considering.
Firstly, these loans are tailored to your specific financial situation, are accepted by a wider range of accredited online institutions, and come with higher borrowing limits.
Additionally, if you or your co-signer have an excellent credit history, you might be able to secure low-interest rates. For example, 2022’s federal student loans come with interest rates between 3.73% for undergraduates and 5.28% for graduates, while private loans’ interest rates for the same year can be as low as 3.34%.
What You Need To Know Before Applying
While private students loans can be extremely useful to fund your online degree, there are a few key differences to keep in mind:
Applying students generally require a co-signer unless they are employed full-time, and the co-signers credit history will influence the loan’s amount and rates
Credit-based: Unlike federal student loans, private student loans are credit-based rather than need-based
Independent lenders might require various documents, including proof of citizenship and information about the college.
Private loans can finance the entire amount you still need to access your desired online degree and fund tuition, educational expenses, and related fees.
Other Options to Fund Your Online Degree
As more degrees are adapted to remote learning programs, more options become available to help you fund your online studies. Undoubtedly, applying for a federal or private loan is the most straightforward solution, but there are other alternatives worth considering.
Today, only 10% of eligible employees take advantage of their employer’s tuition fee reimbursement program. But these programs can help you fund your online degree while pursuing career advancement in your current workplace. Check with your employer about available options and eligible courses.
Not all online universities and colleges accept a student loan – but the majority of accredited institutions make available payment plans to their prospective students. While paying for the entire tuition fee upfront can gain you a small discount, payment plans can help you self-fund your studies when a loan isn’t available.
Scholarships and Grants
Distance learners have the same rights over grants and scholarships as campus-based students. Check with your accredited online university to learn about available monetary awards.
Time to Enroll
While not all online colleges and universities accept student loans yet, the number of institutions opening up to this option is increasing – and so are your opportunities to complete a degree online! Make sure to check with your college to learn more about your available finance options.
Featured image: Andrea Piacquadio, Pexels.