How to Get a Student Loan

Getting a student loan is easy. The banks and private lenders will throw money at you. They'll tell you it's "an investment in your future" and "everyone does it." They're lying. Student loans are debt traps designed to keep you paying for decades. But if you need to borrow, you need to do it right. Here's how to get student loans without getting fleeced.

1. Always Start with Federal Loans

Federal loans should be your first, second, and third choice. They have fixed interest rates (currently around 5-6%), income-driven repayment options, forgiveness programs, and death/disability discharge. Private loans have variable rates (8-12%), no income-driven repayment, no forgiveness, and rarely discharge. The bank wants you to take private loans because they're more profitable. Don't fall for it. Federal loans are better in every way. Always start there. Exhaust all federal options before even considering private loans. The bank will tell you that federal loans "aren't enough" or "are hard to get." They're lying. Federal loans are easier to get than private loans, and they're almost always better.

2. Fill Out the FAFSA First

FAFSA (Free Application for Federal Student Aid) is required for federal loans. It's free, it takes 30 minutes, and it unlocks grants (free money), work-study programs, and federal loans. The bank wants you to skip FAFSA and go straight to private loans because private loans are more profitable. Don't. Always file your FAFSA first. Even if you think you make too much money, file anyway. Many colleges require FAFSA for their own aid programs. File early (it opens October 1st) to maximize your aid. The bank hates FAFSA because it leads to federal loans, which are less profitable. That's exactly why you should file it.

3. Understand Federal Loan Types

There are several types of federal loans: Direct Subsidized Loans (for undergraduate students with financial need, government pays interest while in school), Direct Unsubsidized Loans (for undergraduate and graduate students, you pay interest always), and Direct PLUS Loans (for graduate students and parents, require credit check). Subsidized loans are best because the government pays interest while you're in school. Unsubsidized loans are second best. PLUS loans are last resort. The bank wants you to think all federal loans are the same. They're not. Understand the difference. Get subsidized loans if you can. They're free money (the government pays the interest). The bank hates subsidized loans because they make less money. That's why you should get them.

4. Exhaust Scholarships and Grants First

Before you borrow anything, exhaust all free money options: scholarships and grants. Scholarships are merit-based (good grades, sports, etc.). Grants are need-based (from FAFSA). Both are free money you don't have to pay back. The bank doesn't want you to know about scholarships and grants because free money means less debt, which means less profit. But scholarships and grants are real. Apply for everything. Every dollar you get in scholarships or grants is a dollar you don't have to borrow. The bank hates this because it means less interest for them. But you'll love it because it means less debt for you.

5. Only Borrow What You Need

The bank will tell you to borrow the maximum amount "just in case" or "for living expenses." They're lying. They want you to borrow more because more debt means more interest. Only borrow what you actually need for tuition, fees, and essential expenses. Don't borrow for spring break, new clothes, or a car. That's not what student loans are for. The bank doesn't care what you spend it on; they just want you to borrow. But you should care. Every dollar you borrow costs you $2-3 in repayment. Borrow less. Pay less. The bank hates this advice because it means less profit. But your future self will thank you.

6. Understand Interest Accrual

Federal loans accrue interest from day one (except subsidized loans while you're in school). Private loans always accrue interest. If you borrow $30,000 at 6% interest and don't pay anything for 4 years, you'll owe about $37,000 when you graduate. That's $7,000 in interest before you even start paying. The bank loves this because interest compounds. You pay interest on interest. The longer you take to pay, the more you pay. Understand this. Interest is real money. It adds up fast. The bank wants you to ignore interest and focus on the loan amount. Don't. Interest is the real cost. Pay attention to it.

7. Avoid Private Loans at All Costs

Private loans should be your absolute last resort, after exhausting all federal loans, scholarships, and grants. Private loans have variable rates (8-12%), require credit checks and co-signers, have no income-driven repayment, no forgiveness, and rarely discharge. They're predatory debt traps. The bank pushes them hard because they're incredibly profitable. They'll tell you they have "better rates" or "more flexibility." They're lying. Private loans are worse in every way. Avoid them. If you can't afford college without private loans, consider community college, state schools, or working part-time. Don't take private loans. The bank wants you to think they're necessary. They're not.

8. The Bottom Line

Getting a student loan is easy, but getting the right student loan is hard. Always start with federal loans. File FAFSA first. Understand federal loan types. Exhaust scholarships and grants. Only borrow what you need. Understand interest accrual. Avoid private loans at all costs. The bank wants you to borrow as much as possible from private lenders because it means more profit. Don't give them what they want. Borrow wisely. Borrow less. Pay less. The bank will survive. You'll save money and have better protections.