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How the Increase in Financial Aid Applications Will Affect You

How the Increase in Financial Aid Applications Will Affect You

More students means more financial aid applications.

By Kathryn Knight

January 06, 2009

Colleges all over the country are seeing a rise in applications for federal financial aid. In 2008, more than a million more students applied for financial aid, marking a 10.5% increase from 2007. In the first quarter of 2009, applications for financial aid are up 20.8% as compared with the first quarter of 2008. Not only are more students applying for financial aid, but more students are qualifying for need-based aid.

Financial aid pleas aren’t just voiced toward the federal government. Colleges and universities across the country are also seeing a rise in financial aid applications. Five out of six colleges are experiencing an increase in applications for financial aid. Duke saw a 6% increase in students applying for financial aid, while North Carolina saw an increase of 22%.

Unlike Duke, most schools cannot meet 100% of financial need within its student body. Therefore, students have to make more costly decisions, such as transferring to less expensive schools like public universities or community colleges. Others are stacking up on student loans and creating a mountain of debt to be dealt with after graduation.

So what can you do to avoid transferring or loading up on debt? Talk with your financial aid office first to see what they can do to alleviate some of your financial concerns. Start up a part-time job during your second semester—the paycheck can go straight to your tuition bill. Finally, check out peer-to-peer lending sites to borrow from family and friends instead of private lenders.

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