Community Colleges Denying Loans: Federal Loans Made Less Available For Students Attending Schools

Community Colleges around the country are dropping the option of students taking out federal loans, insisting that they are more than students need. Others disagree.

A new study has discovered that students attending community college are less likely to receive federal loans to help finance their expenses. More and more schools are not taking part in the federal loan program, leaving over one million college students looking for alternative, often more expensive ways to pay for their education. The schools claim that they are trying to keep college students from heavy borrowing, but others say that not having this option is more harmful than helpful.

How This Hurts Students

The study is to be released on April 24th by the Project on Student Debt group from California. The schools believe that students are going to receive more aid than they need to attend these cheaper, two-year schools and that they will get into more debt than needed. However, the makers of the study as well as financial aid administrators, disagree with the schools’ decisions, believing that students will be required to work more or find other ways to finance their schooling, such as through private loans and credit cards.

Federal loans, including Stafford loans, contributed to $50 billion in financial aid last year. However, the current credit crisis and subsidy cuts are causing lenders to be less enthusiastic about investing in such loans, creating less money to go around for college students. Adding to this is the fact that students are now being denied federal loans because of the school they choose.


One in 10 community college students will be affected by this crisis throughout the country. However, these statistics are much higher in the southern states, particularly in Georgia, Alabama, North Carolina and Louisiana where 47 percent of the students in these states could be affected. Minorities are also largely impacted by this problem. In some states, less than half of all black students will qualify for a loan while only 8 percent of Native Americans will qualify in states such as Montana. Meanwhile, white students’ odds stay around 90 percent.

Low-income students are also at a higher risk for not receiving these loans, and they are the ones who benefit the most from them. When attending community college especially, the loans can even cover the costs of other expenses after classes are paid for, such as books and bus fare. This is because the average tuition fee at a community college is about a third of the cost of the average public school cost, about $2,361 each year.

Though only 10 percent of community college students are said to use federal loans, those who are denied them will be forced to find more expensive alternatives, including those that take a toll on their academic performance, such as working more hours to make up the difference.

Emergency Cash Loans – Pros & Cons: A Quick Cash Advance with No Credit-Check, Bad Credit Not a Problem

Most people need an emergency cash loan to help with those unexpected expenses that crop-up from time-to-time. The car may break down meaning that it is impossible to get to work from a rural location or a wage may be paid late leaving nothing to pay the rent or mortgage. A no credit-check, quick cash advance may provide the answer. It is a short-term loan, aimed largely at those with a bad credit rating, to help a struggling consumer out of a financial hole. The most common emergency cash loans include pawnbroker, logbook and Payday loans from the likes of

Advantages of Emergency Cash Loans

  • Essential bills. A quick cash advance can help to pay bills and expenses when personal savings aren’t available. For example, paying the rent could prevent eviction.
  • Bad credit rating. A short-term loan is available with no credit-check which means that it is a suitable way to borrow money for those with a bad credit rating.
  • Quick cash advance. A short-term loan is often made available within 10-15 minutes. A traditional bank loan can take weeks to be approved.
  • No credit-check. There is no credit-check which is helpful for those with a bad credit rating or who don’t want lots of credit searches showing on their credit report.
  • Unable to borrow money. An emergency cash loan is useful to those who wouldn’t otherwise be able to get a short-term loan.

Disadvantages of Emergency Cash Loans

  • High interest rate. The higher risk of default on an emergency cash loan means that it costs more to borrow money than for good credit customers.
  • Financial difficulties. Whilst a quick cash advance can help someone out of a tight spot, the high APR on a Payday loan leaves less money for household bills for the month after.
  • Impulse buying. An emergency cash loan may feel like easy money and encourage impulse buying. Whilst paying the mortgage is essential, going on holiday isn’t.
  • Personal debt. A quick cash advance is yet another form of personal debt. Consumers already struggling with credit card debt will find that a higher percentage of income goes towards debt repayments each month.
  • Collection agencies. Failing to pay back the debt will lead to personal debt spiraling out of control due to the high APR charged to those who borrow money. It can lead to pursuance by collection agencies.

An emergency cash loan should be considered a way of dealing with a one-off, unexpected outgoing that cannot be covered by savings. A quick cash advance or any no credit-check loan is ideal for those with a bad credit rating. Choosing to borrow money with a short-term loan attracts a high APR; this will leave less money available to cover household bills the next month.

Federal Student Loan Consolidation Companies

The high cost of college education has forced many students to take up loans to cover their educational costs. After completing the graduation it becomes quite problematic for the students to repay and track multiple loans. This is the time when federal student loans consolidation companies prove to be of great help. Student loan consolidation is the best alternative to repay your loans easily and comfortably. You will be able to have good control on your finances and manage them in a better way too. Along with other advantages you will be free from the hassles of managing a number of loans.

Consolidating your student loans will merge all your loans into one and your monthly installment will get lowered and your loan repayment period will also get extended. When you have decided to consolidate your federal student loans, you have two options in your hand – federal direct student loan program and federal family education loan program. These programs will consolidate your federal student loans on fixed rate of interest and the amount of your installments will remain same always. Consolidating your loans at fixed rate will help you manage your finances properly because then you will be able to plan for other expenses also.

There are several federal student loans consolidation companies that can be found on internet. Besides federal agencies, you will find some of the private agencies also that will help you consolidate your federal loans. It is almost certain that along with federal loans, you must be having some private loans also. But you cannot merge your private loans with federal loans and for that you will have to find a private dealer only. However, you can merge your federal loans with the private ones. But in that case you will lose all the benefits of federal loans.

Always remember that even a small difference in the rate of percentage will bring big differences on the whole. You will be able to save lot of money by the end of the repayment tenure even if your rate of interest is low by one percent. Fix the lowest rate possible with federal student loan consolidation companies.