Student loans: a necessary evil or a pathway to success?

Working in the Financial Aid Office at Chattanooga State, I've seen it all. Some people are vehemently against borrowing, while others see loans as a way to alleviate immediate financial stress and focus on their education. But let me tell you—there's a side of borrowing that rarely gets talked about.

Imagine this: years later, a student comes back, burdened by the weight of their loans. They sit across from me, tears streaming, regret written all over their face. They did nothing to address those loans, and now it's affecting their ability to survive and achieve their dreams. And if they didn't even finish college, the situation becomes even more dire. Too often, I witness students with staggering $35,000+ loan balances and no degree to show for it.

College Loans and Your Credit Score

So, here's the question: can student loans impact your credit score? The answer is a resounding YES! As students, you need to plan for your future. You must complete college, build an impressive resume, and budget for loan repayment. But let's face it, navigating the college financial landscape isn't easy or cheap. Many students resort to loans because they lack savings or family support. And to add fuel to the fire, financial aid packages are often limited while costs keep rising. You have to juggle housing, food, transportation, communication, and possibly even childcare. Loans can seem like a lifeline for survival.

Here's the shocking truth—getting a federal student loan in college is a breeze: no credit check, no loan application. The loans are simply handed out as part of the financial aid package, and repayment only kicks in after graduation. In other words, no worries, right?

Not so fast! Getting the loan is the easy part, but repaying it is a whole different story. Student loans are a form of debt with legal obligations. And guess what? Your loan status is reported to the credit bureaus every month. So, being prompt with payments is crucial. It's also wise to check your credit report regularly to ensure accuracy and maintain a good credit score.

Student loans dominate the news and for good reason. They have a profound impact on our personal lives and the economy at large. In short, think twice before borrowing unnecessarily or taking the full loan amount.

Research Loan Alternatives

Completing the FAFSA isn't just about accessing student loans; it's also a requirement to access grants and scholarships. These financial resources can support your college education without the burden of repayment. At ChattState, students may be eligible for various scholarship and grant opportunities, such as the Hope Scholarship, TN Promise, TN Reconnect, or the Pell Grant. Additionally, ChattState offers scholarships, with over $1 Million awarded last year. Remember, not all scholarships are solely based on grades, but you won't qualify unless you complete the FAFSA and actively search for scholarships you may be eligible for.

Plan For Your Future Today

Aim to keep your total student loan balance below your projected annual salary to make repayment more manageable. Income-based plans exist to help, but you need to reach out to your loan servicer for assistance. Above all, stay connected with your loan servicer, make at least the minimum required payment, and safeguard your credit score.

Don't let student loans rule your life. Take control, make informed decisions, and secure your financial future.