About student loans

[yisy4u]

Hi guys. I'm having some problems with financial aid and they won't cover my whole tuition this year. So I owe the school like 300 dollars that I really cannot pay from my pocket. I was thinking about asking for a student loan. But will they give me a loan for 300 dollars?? and then if they do...will I have to ask for a loan every semester? I don't understand how this work. What should I do?

[One2gofst]

Since you are receiving Pell grants, it sounds like, you should qualify for subsidized Stafford Loans. My suggestion would be to take out the maximum allowable subsidized amount. Take what you need to cover your costs and put the rest in a CD or money market account and earn a percent or two on the money.

For subsidized loans the govt. pays the interest while you are in school and you only start accruing interest once you are out of school. With my method you will have a safety net for other unexpected educational expenses and if you never need it, you can pay the money all back when you get out and have a small amount of interest left over.