Topics: Student Loans
We all know what an emergency is, right? It’s basically crisis mode. And when it comes to money for college, running short on funds can send you straight into a panic. Emergency student loans are a last resort option that exist precisely for circumstances like this. Don’t get overwhelmed by this unexpected and urgent situation. Before throwing in the towel, ask for help. You’re not the first person to find yourself in this position, and there are solutions to explore.
How Do Emergency Student Loans Work?
Emergency student loans are intended to be a short-term solution to a short-term problem. They are issued by your college or university typically in small dollar amounts. They are not intended to replace federal aid, scholarships, or Federal Work Study. If you find yourself in this situation, start by talking to your Financial Aid Office.
Here are some basics:
• Different schools offer different levels of support. At most small to mid-sized institutions emergency student loan amounts max-out at $2,500. Some larger schools offer higher amounts of aid. You won’t know what’s available at your school, until you talk to the financial aid office.
• Loans are often used to help with financial hardships, medical emergencies or situations that may threaten a student’s ability to stay in school.
• In many cases, loans need to be repaid within 30 to 90 days. Again, emergency student loans are intended to be a short-term solution, not a replacement for federal financial aid. Terms will vary by school.
• Some schools offer an emergency grant program, in addition to loan programs. Grants work differently from loans, because they do not need to be repaid.
• Emergency student loans may not be the only solution. Some campuses also provide things like food and book vouchers.
What are emergency student loans used for?
• Housing or safety crisis
• Food crisis
• Transportation crisis
• Small balances owed that may prevent you from enrolling for new classes
• Airfare/travel costs for family emergency or funeral
• Expenses related to an emergency room visit
Is my credit history a factor?
For the most part, emergency student loans are not based on your credit history. But do keep in mind that the repayment period begins pretty much immediately (within 30 to 90 days, on average). Be prepared for your college or university to ask questions about your current income (if any), your parent’s income and the basis for your need. You can also expect them to review your academic standing.
The Bottom Line
Your school wants you to succeed. In many respects, your success is their success so your ability to remain in school is important to them. Emergency student loans are used for extreme circumstances and the amount of funding provided—along with the loan terms—is intended to help protect the program to ensure it benefits as many students as possible. Sometimes the school will explain that your documented needs do not truly belong in the “emergency” category and may recommend a private student loan instead. If you need to explore private student loans, visit our compare lenders page, to view options and terms from our lending partners. Above all, don’t lose hope. Many times, a solution is available.