Find Your Way in the Arizona Student Loan Forest

A Basic Strategy for Financial Aid

Up until just recently the Arizona Higher Education Loan Authority (AHELA) was THE not for profit provider of the state’s loan program. But turbulence in the financial markets forced the agency to suspend its student loan program. So now what?

Here’s the deal: just because a student loan provider has had to pull its loans off the shelf doesn’t mean you have no sources for student loans. Truth is now you have plenty, but you must know where to go for trusted information.

Step-by-Step Student Loans for Arizona Do-It-Yourselfers

There is an affordable and responsible way to get the student loans you need:

Federal loans first. Apply for your federal loans by completing the FAFSA, or the Free Application for Federal Student Aid. If you miss the deadline on this you are out of luck for the academic year. Worse yet most other student loans also require you have completed the FAFSA, so it’s a big mistake to miss it.

Simply, the Federal Loans include:

  • Stafford Loans, subsidized and unsubsidized, are popular and widely disbursed across the country. Best feature: no credit check.
  • Grad PLUS Loans, designed to kick big grad school debt to the curb. If you’re an Arizona grad student and you’ve reached your Stafford Loan limit your next level of affordable student aid is the Grad PLUS program.
  • Parents, have a student in an Arizona school, struggling to pay those undergraduate expenses since the federal loans run really short? The Parent PLUS Loan can help you reign in out of control college expenses that otherwise threaten to break your bank account or drive you to re-mortgage the house, sell the boat or something else unfortunate and costly.
  • Consolidation Loans are not widely offered anymore. The Direct Federal Loan program still provides this product, but most lenders emphasize the Extended Repayment plan when you sign for your loans. Plan ahead for debt management.

Learn more about the federal loan programs and how to apply them to an Arizona college or university.

Private Arizona Student Loans

Misconceptions abound regarding private college loans. The unfortunate thing is that many students borrow with these as a first resort – leaving federal cash on the table – because the application process for private loans is much simpler and quicker. It’s an immediate gratification. BUT it’s a mistake in the long run. Why?

Private education loans are much more costly than federal loans: higher, sometimes risky, interest rates, hidden fees, borrower minimums, high credit limits and other unforeseen pitfalls that could put you in serious debt trouble after graduation. Choose a lender that is reputable and well-known. Rule of thumb: only borrow from a private student loan what you absolutely need to pay the remaining balance on your education costs.