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The cost of a college education will continue to rise, so for most students, paying for school outright is just not possible. However, financial aid and student loans can be daunting and confusing. Consider this advice from Citibank to keep your education loan habits responsible.

“Even with savings, gifts from family, and scholarships and grants, you may find that you need additional funding to pay for your higher education. Student loans can make up the difference between what you have and what you need to make your college dream a reality. Unlike scholarships and grants, however, borrowed money must be repaid, most often with interest, regardless of whether you complete your education or not.

Borrow Only What You Need
While you may qualify for more, borrow only the amount you need. Loans are your responsibility and you are expected to repay them. When you repay your loan on time, you create and build an excellent credit history. This will help you in your future when making purchases such as a car or a home.

Here are some helpful points to consider:

• Estimate the amount of debt you can afford - don’t get in over your head.
• Understand your borrowing agreement fully - including all interest calculations.
• Stay on schedule - remember your excellent credit history is at stake.
• Prepay your loan if you can - you won’t incur any penalties, and you’ll save on the total interest due.
• Loan counseling - this will explain the federal requirements you must meet to borrow a Stafford Loan and help you better understand your repayment options.

Select Your Lender Carefully
Choosing the right lender can make all the difference in your student loan experience. Choose the right one, and it’s smooth sailing. Choose the wrong one, and it’s one more thing to worry about before, during and after college.

Lender services may vary, so here are some important considerations when making your decision:

• Interest rates and terms: Are they competitive?
• Application process: How convenient does the lender make this? Can you apply online? Does the lender provide instant approval?
• Loan servicing: Will the lender service your loan directly or sell it to another party? Where does that leave you?
• Repayment: How flexible are your options? Will the lender work with you to meet your needs?
• Account management: Can you review your loan account online?
• Additional benefits: Does the lender offer reduced interest rates for on-time payments or electronic payment?

Your school’s Financial Aid Office can provide you with a list of preferred lenders or you can visit Citibank’s www.collegelenderlist.com, which lists preferred lenders for many colleges and universities.

Borrowing Is Serious Business

The bottom line: Borrow responsibly now and you’ll appreciate it later!

For more valuable information:

• Get a more detailed estimate of what your actual payments may look like with the Repayment Calculator.
• To learn more about student loan options, check out the Loan Types Overview page.
• Gain a better understanding of financial aid terminology with the help of the Glossary.
• Understand the aid application process and what to expect in How to Apply for Aid.”
• Read the financial aid articles at Search4careercolleges.com.

Article from Citibank for Yahoo Education