|Line A||Tuition, room and meal plan||$21,000|
|Line B||Amounts offered to you in scholarships or grants||$4,500|
|Line C||Additional expenses you have to cover (personal needs, transportation, etc)||$4,000|
|Line D||Amount you can borrow in government loans||$5,500 (plus interest)|
Here’s how to look at it:
The answer is: it will increase your cost of attending by the amount of interest you pay on that loan.Here’s why: Simply put, taking out a loan doesn’t lower what you have to pay, it just delays paying it for for a while. Only with a loan, you not only have to repay the amount you borrowed, you also have to pay interest on that amount. So your costs actually go up. Of course, there’s no question that college does cost a lot of money. So for most students –between 60% and 70% of them, in fact – taking out a loan is a necessity, because they and their families don’t have that much cash available. The message: be careful – and don’t get fooled into thinking loans save you money. They just let you spread out the amount of time to make your full payment. And in return, you have to pay out more in fees and interest.