Amid soaring student tuition and stagnant federal grant disbersal, students are always looking for alternative means of revenue in order for them to help meet their financial needs.
A widely circulated newspaper recently reported Latino students are more likely to decline college loans as part of a cultural fear of debt, preferring to work their way through school. This strategy is considered by its critics to be hindering their education.
“It’s stereotypical,” said Marcos Zamora, a Chicano/a studies major who said he does not believe that declining loans have anything to do with the Latino culture. Zamora, who has student loans, said he is more concerned about paying them back.
CSUN’s Office of Institutional Research reported that out of the 33,243 students enrolled in the 2005-2006 school year, 10,618 received loans. Although Latinos were the second largest ethnicity on campus during that school year, they received more loans than any other ethnicity – a direct contradiction of the alleged Latino consensus regarding student loans.
Gregorio Alcantar, a CSUN financial aid counselor, said he does not necessarily see a distinction between student ethnicities when it comes to loans. “The consensus is the same,” said Alcantar. “No loans.”
Alcantar said he has noticed that when students decline loans, it is usually because parents are influencing the decision. This, he said, is due to the lack of understanding on behalf of parents and students about how loans work.
“I would be less likely to do something if I didn’t know anything about it,” said Alcantar, whose family knew nothing about the college process when he was going to school. “You make choices based on what’s around you,” he said.
There are several misconceptions that students have when it comes to loans. When students are offered loans, many think they did not qualify for financial aid, Alcantar said.
However, loans are considered a form of financial aid.
Veronica De Paz, an accounting major, said students already have other expenses to worry about and having a loan only adds to the burden.
De Paz, whose grants cover the cost of tuition and books, works 30 hours a week in order to pay for her personal expenses. Some students also use credit cards to cover their expenses.
Alcantar said students don’t realize that using a credit card to pay for school necessities is a type of loan. “Credit cards are like carrying a loan in your wallet,” Alcantar said.
The difference is that certain student loans, such as subsidized loans granted on the basis of financial need, don’t have to be paid back until after graduation and there is no interest charged to the student while they are still in school.
Credit card payments, on the other hand, usually have to be made within 30 days and begin to accumulate interest instantly.
Another misconception that students have is that when they submit a free application for student aid at the beginning of the school year, they do not have to worry about it again until the following year.
Alcantar said a FAFSA is not just about submitting a form.
He said it opens up an opportunity for a relationship between students and financial aid advisers.
Students have the responsibility of notifying the financial aid office of any changes that may affect a student’s financial aid status.
A student gets the extra aid he or she needs, Alcantar said. In the end, students have an overall responsibility to manage their finances.
Alcantar explained that there are really only three things student should take into consideration in order to get their degree: Paying tuition on time every semester, buying books and paying rent. Everything else should be budgeted accordingly.
“Borrow what you need, not what you want,” he said.