Filling the Student Loan Gap

RICHMOND, Va. (WWBT)-When it comes time to go to college, experts say make sure you and your teen exhaust all forms of scholarships, grants, aid, work study before turning to student loans .

Cherry Dale, financial coach at Virginia Credit Union, says these days you’re likely going to face a funding crunch…because even federal student loans won’t pay the full cost. “Your student may qualify for student loans and his name only pays in many cases especially if you are considering a four year college in state or even going out of state you are going to cost more than what your student can borrow. “

Dale says turning to private student loans should be a last resort because they come with higher interest rates and are more expensive overall than federal student loans.

They also usually need a co-signer who puts an additional person on the hook – likely a parent.

If you want to help your child bridge that funding gap…there are personal loans, home equity loans, savings accounts, 529 plans. Dale says you might also consider Parent PLUS loans.

One of the biggest differences between Parent Plus and other student loans is that it requires a credit check. But– to be eligible, your child must complete the FAFSA.

Copyright 2022 WWBT. All rights reserved.

Send it to 12 here.

Want the best NBC12 stories in your inbox every morning? Subscribe here.