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Decisions, decisions…Pay now or later?

     Paying tuition and fees can be a challenge for college students, but sometimes the loans that are supposed to help students are pushing them toward a lifetime of debt.

     According to collegescholarships.org, most undergraduate students graduate with close to $20,000 in student loan debt. Some students are taking advantage of student loans and using this money more as a payday than for college expenses, without seeing the long-term consequences these decisions can have.

     Student loans help students pay for tuition, books and living expenses during college. They come with interest rates, which are charges for the use of the money and must be paid back within a certain time period after the student stops taking classes. Accepting a student loan is entering into a contract with the lending company and borrowers will become obligated to pay back their loans.

     It can take up to 30 years to pay off student loans and the interest fees. Students need to be cautious when accepting loans because they can still be paying back their college loans while they are trying to pay for their own children to attend college.

     Not only can it take years to pay off student loans, but loans also affect your credit score. The more money a student owes and the longer it takes to pay back, the lower their credit score can get. According to myloansconsolidated.com, student loans that take 10 or more years to pay off will lower a credit score because it will be considered on the credit score as too long to pay off a debt.

     Myloansconsolidated.com also states that student loans can be reported on a credit score in triplicate, which means that $15,000 in student loan debt can show up on the credit score as $45,000 because it’s reading as owing three times as much. If students’ credit scores are too low, they can have trouble buying a car, buying a house, taking out loans and even renting. If a credit score is too low, a damaged financial reputation can follow students for years.

     A lot of students see the idea of student loans as an opportunity for free money. When they get their loan refunds they think more about shopping than buying books or paying for living expenses. Student loans are not for buying a new iPod or getting a new wardrobe, and the students that see them as a payday are most likely not seeing the true consequences of borrowing money. Students see these loans for the short-term of getting free money quick. Student loans though are long-term options that can result in many different problems that could haunt students for the rest of their lives. Yes, at that moment students will receive a lump sum of money that they didn’t have to work for, but  loans are anything but free.

     Student loans are not specifically a bad thing, but they can become a big problem if they are not handled properly. A lot of thought needs to go into the decision whether to take out a loan and it should not be taken lightly. There are many other solutions like payment plans that can help pay for college as well. Loans should only be considered as a last option. Debt is to be expected after graduating college, but students don’t have to be bombarded with huge fees that will take years to pay off.

     Student loans should only be used when it’s an absolute necessity to attend college. If a student does take out a student loan, they should only borrow the minimum that they would need to survive. Borrowing for a payday will just lead students towards a lifetime of debt.

     Always check the free money options like scholarships or grants before accepting a loan. Students should always fill out the Free Application for Student Financial Aid (FASFA) because is it a free process that could reward students with money that doesn’t have to be paid back.

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