If you need a loan for college, there is no question that federal loans are the way to go. The interest rates are low and fixed, fees are small and the government pays the interest for students while they are still in school and sometimes even after graduation if they become unemployed or face other economic hardships. Federal student loans are offered to all students, regardless of background, class or credit history. So it was a surprise to find out that some community college students cannot get any form of federal loans. Instead they are forced to go with more expensive private loans or find other alternatives to pay for their education.

While almost all four-year colleges and universities in the country participate in the federal loan program, a large number of community colleges do not. The students who attend these community college cannot get a federal student loan. As a result they are forced to resort to credit cards and costly private loans to fill the gaps in their finances.

So what’s the reason for not supporting federal loans? As summed up in an issue brief from The Project on Student Debt, colleges sometimes think that students should not borrow for a community college education to prevent student debt from ballooning for individuals. As the brief also points out, this is not realistic when students must still cope with the ever-growing costs of tuition and other costs. Even a bigger slap in the face is when colleges try to guide students to other, riskier borrowing options like private student loans. Read more…

Charity For Debt is a startup nonprofit group (with a very nice logo) dedicated to helping students and alumni with debt pay off their student loans by providing paid volunteer opportunities by working with local charity organizations. The nonprofit was launched just this year but already has had many sign ups from potential volunteers. So if you’ve ever thought about giving back to your community, this is the perfect time. Not only will you be giving back but you will also be paying off your debt.

Charity For Debt depends on 3 groups to work: the student and alumni volunteers who want to pay off their debt, donors who are looking for innovative ways to donate to the local community and see the direct results of their dollars, and nonprofit or charity groups that need volunteers to keep their organizations running. Read more…

Its no secret that the debt of the average American citizen is rising. Wages are being outpaced by growing inflation and with the possibility of a recession, things aren’t looking any better. Among the people affected the most are students. Below are statistics about student debt and loans that everyone should know, whether they’ve been to college or not.

Today, more than ever before, more students are borrowing to cover their college expenses. By the time they graduate, nearly two-thirds of students at four-year colleges and universities have student loan debt (66% in 2004). In 1993, less than one-half of four-year graduates had student loans, compare that to 2004 when over 60% of graduates from public universities had student loans. Read more…

I’d like to thank Laura Moran from TheStreet.com for writing about this site in her recent article How to Get Someone Else to Pay Your Student Loans. The article takes a look at the alternatives other people have thought of to pay off their student loans.

One of those chronicled in her article is Luke Livingston. Upon graduating college, Livingston thought of an interesting way to pay off his student loans. He started a website called sponsormyloans.com, where he offers to provide advertising and ad space on his website to anyone willing to pay $200 each month. He is hopeful that more businesses will advertise, thus sponsoring his student loan payment for the month. Read more…