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Remote Learning at College: Will Your Student Loans Change?

Will Remote Learning Change Student Loans
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In 2020, student loan debt has ballooned to $1.6 trillion, and the pandemic has universities scrambling to figure out a safe method to bring students back this fall. Several institutions have already made the decision to go completely virtual, but are keeping tuition costs the same.

With changes in how classes will be delivered, students and parents may be wondering if their financial aid will change too. Many college students were already financially stressed after being left out of the first round of stimulus checks, so will their finances be stressed even more? Here’s a look at the financial aid landscape for students as campuses go virtual, and what they can expect for the fall semester.

Does remote learning affect student loans?

The pandemic has shaken things up in all aspects, including the way college students attend school and how they pay for it. In most cases though, remote learning has not changed the amount of financial aid awarded to cover tuition because aid is determined by the information you provide on your FAFSA or private loan application.

Right now, federal student loans have extremely low interest rates with 2.75% for undergraduate borrowers on both subsidized and unsubsidized loans. The good news here is that the interest rate is fixed and will not change during the life of the loan.

However, you might see the amount of financial aid offered change depending on your living arrangements. In most cases, your financial aid amount also covers housing, regardless if it’s on or off campus. If you have made changes to your housing plans, check with your student financial aid office about potential refunds and cancellation policies.

What to do when virtual learning comes with the face-to-face price

Why are colleges charging the same tuition this fall if the learning landscape is so different? One reason is the added costs to moving instruction online. Not only does the campus staff have to make sure the software is set up correctly for thousands of students, they also have to ensure there are secure methods for uploading assignments and testing.

Even though many traditional campuses are adding this virtual learning for students, is there anything you can or should do if the cost of attendance still comes at the usual in person price? As one way to manage loan debt levels, students may be considering taking courses from cheaper institutions like community colleges, and transferring the credits.

Calculus, for example, can be taken virtually for just $400 from Outlier and transferred to your university. Compare that to $594.46, the average cost of one college credit, which means a typical three-credit course runs most students nearly $1,800. Many college departments add their own fees on top of the per credit cost, making it very expensive for students to take even the most basic courses.

If you choose to manage your loan amounts by taking an online course from another institution, make sure you understand how the credits will transfer and if you’re within your primary university’s transfer limits. For example, the University of California campuses limit transfers to 70 course credits for lower division coursework, and generally prefer the transfer comes from a California community college. However, if you’re transferring out-of-state coursework you can refer to a course catalog. As long as the course is similar to one offered by University of California, you can typically transfer the credits.

Universities freeze tuition

Typically, tuition increases 2-3% per year, but many universities are not raising tuition in the fall in hopes of retaining more students. With many families out of work due to the pandemic, colleges are facing losses of those students who may have to drop out or turn to more financial aid for college.

A tuition freeze may provide some relief to the 70% of students who borrow money to go to college. Since tuition won’t go up, you can better predict how much you’ll actually pay this year. But even if your university isn’t implementing a tuition freeze, there are other ways you could receive a discount this fall.

Anticipate other campus refunds

There may be some restrictions on how many students are allowed to live on campus, allowing possible refunds on room and board. While it may force students to seek alternative living arrangements, it could offset the cost of the year overall, so check with your university about other campus refunds.

Universities might extend a discount in additional areas like campus parking or student access fees. Many students pay for additional perks, like a student-only recreational facility, events, and concerts. In an effort to reduce large gatherings, universities might suspend these activities, which could put some money back into your wallet.

Kansas State University, for example, will offer prorated refunds on parking and on-campus housing if the university decides to go completely virtual. Other universities, like UC San Diego, still plan to charge a student services, campus activity, and recreation facility fee which adds up to more than $1,500 for the academic year.

If you have existing student loan debt

Remember, if you have existing federal student loan debt, payments are in administrative forbearance through September 30th. That means you are not required to make payments and no interest will accrue during this time. This benefit was applied automatically to all accounts through the CARES Act.

Another stimulus bill is in the works, but currently it does not extend student loan forbearance. Make sure you have a plan to pay off debt and take advantage of other forbearance options if you are unemployed.

Loaded down with debt?

If student loan payments and covering other bills feels stressful, you’re not alone. A good starting point to getting your debt under control is to understand what you owe and how to manage it. The How to Manage Debt Guide from Freedom Debt Relief is free, and it covers several strategies to pay off debt, including our debt relief program. Download the guide now.

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Justine Nelson is the founder of Debt Free Millennials, an online community to help millennials eliminate debt and live a debt free lifestyle. As a freelance writer and YouTuber, Justine enjoys creating upbeat and educational personal finance content. This Midwest millennial paid off $35k in student loan debt and now resides in San Diego with her husband.