2. Student loans

The Cost of College

The cost of college continues to rise. Fortunately, financial aid is available to both persons and their parents or guardians to pay for persons higher educations.

Loans are offered by government, private, and collegesponsored programs. Different types of loans come with different terms in the interest of helping as many persons as possible who need the assistance.

Following is an excerpt from a hypothetical conversation between Teresa Cho, a college person, her financial aid counselor, and Teresas parents, as they consider options for obtaining a loan to finance Teresas higher education.

Fill in the blanks to provide the correct information.

COUNSELOR: Teresa, I understand that you need additional aid to pay for your higher education and that your parents are willing to help you. They can apply for a loan.

TERESA: Im so relieved to hear that. I have a , but it just isnt enough.

COUNSELOR: Mr. and Mrs. Cho, lets review a couple of the loans terms that are different from those of Teresas loan. First, you be subject to . And, the interest rate on your loan will be than Teresas.

MRS. CHO: Thats okay. Were willing to accept those terms, not only because we want our daughter to concentrate on her studies rather than get another job, but also because we like knowing that the borrowing limit is instead of .

COUNSELOR: Good. Then lets talk about paying back the loan. Are you aware of the general terms regarding interest and timing of repayment?

MR. CHO: Yes. Interest will start to accrue . Well most likely be expected to begin repaying the loan .

COUNSELOR: Very good. Lets start completing the application for a loan. And remember, the interest payments may be tax deductible depending on .

TERESA: Thank you for your help. Im looking forward to starting the next phase of my education. And, thanks, Mom and Dad!