How to Finance College if You Don't Qualify for Federal Aid

Time To Read 2 MIN READ

Given the price point of attending college these days, not many can easily afford to write a check for their child's tuition, especially if there is more than one college-age student in the family. Luckily, if you have trouble affording college tuition but make too much to qualify for need-based financial aid, you still have options. These tips can get you started.


Pick Your College With Care

Private colleges— like Ivy League schools — can be staggeringly expensive, charging almost as much in tuition as the average U.S. household earns in a year. One way to keep costs down is to select a public university — even better, a public university in a state in which your child can qualify for residency. The average tuition paid by a state resident to public schools averages less than one-third of what you'll pay at private colleges.


Apply for Merit Grants and Scholarships

Federal and state financial aid is need-based, but that's not always the case with grants and scholarships. Your student can start getting merit-based scholarships and grants as early as his or her freshman year in high school. Ask the high school's financial aid counselor about merit scholarships available at your institution of choice and investigate scholarship funds awarded by various academic departments.


Look into Alternative or Private Loans

The newest college loan product is what financial aid experts call "alternative loans," or private student loans. These target families who earn too much to qualify for federal financial aid. 

The federal government does not back private loans for college. They are credit-based and have an application process and an interest rate closer to a traditional consumer loan. 

While private student loans cost more than federally backed student loans, they are often less expensive than using personal credit. Some private loans include student-specific benefits like deferring payments while the student is in school, waiving prepayment penalties and offering hardship deferment options.


Top Students Should Think About No-Loan Schools

If your student does well in high school, suggest that he or she apply to private colleges that bill themselves as "no-loan" schools, meaning they assist accepted students with grants, scholarships and work-study income that fully cover their college costs. 


Top colleges, including Harvard, Stanford, Amherst, Vanderbilt, Cornell and Bowdoin do this, as do some 50 schools across the country, although there is usually a family income limit for this assistance.