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Though tuition is only one aspect of education costs, student loans are meant to cover other costs as well. You can also use student loans for living expenses.
You can only borrow the amount equal to the cost of attendance at the school, which includes tuition, fees, books and supplies, lodging and board, transportation, and personal expenses, less any aid you may receive.
The cost of attendance is set by each college and is adjusted annually to cover costs for one academic year. Schools compute figures for in-state and out-of-state tuition as well as for commuter, off-campus, and on-campus students.
Direct loan payments are made to your school, which deducts room and board if you live on campus, tuition, and fees for both federal and private loans. You will receive any remaining loan funds in accordance with your school’s policy. After that, you can either return any money you don’t need or use it to pay for supplies, books, and living expenses.
The Federal Student Aid office’s and private student loan lenders’ guidelines are the source of the following examples.
What can student loans be used for?
- Tuition and fees
- On-campus room and board
- Off-campus housing and utilities
- Transportation, including gas, tolls, buses and trains
- Books, supplies and equipment related to your major
- Miscellaneous personal supplies, including toiletries and medication
- Housing supplies, including linens, a microwave and dishes
- Groceries
- Take care of your dependents, provided that you inform the financial aid office at your school that this reimbursement needs to be included in your aid package.
- Fees for professional testing, licensing and certificates
- Study abroad program costs
What you shouldn’t use your student loans for
- Entertainment, such as concert tickets and Netflix subscriptions
- Pricey electronics, such as an oversized television or sound system
- Travel, vacations or hotel stays
- A new car, motorcycle or a bicycle
- Nightly takeout or delivery food
- A down payment or repairs on a home or car
- Small business expenses
- Additional debt, including credit card debt, auto loans, and personal loans
- Anyone else’s education costs
What happens if you use loan money for nonessentials?
Generally speaking, nobody is monitoring your use of your student loan funds. However, if your lender discovers that you misappropriated student loan funds, you may have to pay penalties. Your present loan and any future loan options may be terminated, and you may be immediately obligated to pay back the entire amount of what you have already used, depending on your lender’s policies. The fact that you must repay borrowed funds with interest serves as a stronger disincentive to squander it.
Alternatives to using loans for living expenses
Although you can borrow money to cover living expenses, you shouldn’t always You might be better off using your savings, finding a part-time job while in school, or earning extra money by working during breaks in your studies. In this manner, you can cover your living expenses in full without incurring more debt than you can manage.
FAQ
Can student loans be used for housing expenses?
In summary, students can use their federal or private student loans to cover living expenses such as rent each month. Nonetheless, a student’s choice of housing will have a significant impact on the total amount of debt that needs to be paid back in the future.
Can I use student loans for anything?
No, student loans aren’t a free-for-all spending spree. The U. S. The Department of Education and nearly all private student lenders provide a list of permissible costs and purchases, which usually includes study abroad expenses, transportation, child care, books and supplies, room and board, and tuition.
Does FAFSA give you money for living expenses?
Financial Aid May Pay Part of Your Housing Expenses The total cost of attendance, which includes housing, books, supplies, transportation, and tuition, will vary depending on the school you’re attending.
Can I use student loan for moving expenses?
You should think about using student loans to cover your moving expenses whether you’re moving into dorms for college or leaving to start your first job.
Read More :
https://www.nerdwallet.com/article/loans/student-loans/student-loans-for-living-expenses
https://www.edvisors.com/ask/faq/student-loans-for-living-expenses/