Although student loan debt at NMU is lower than the national average, the nation’s student loan debt is increasing, and NMU is likely to follow the same route.

According to Mark Kantrowitz, publisher of FinAid.org and Fastweb.com, the nation’s student loan debt has exceeded more than $830 billion, which has surpassed the nation’s credit card debt of $826.5 billion.

“There has been significant growth in the total amount of student loan debt outstanding,” Kantrowitz said. “About $300 billion in new student loan debt has been made in the last four years.”

According to estimates from the ‘07-’08 academic year, graduating students from NMU, on average, were in debt $18,498 while the national average was $23,200. Even though NMU’s average is lower than the national average, there has been an increase over the past few years, said Mike Rotundo, director of Financial Aid.

“We’ve seen about a five percent increase in student loan debt for students that are graduating,” Rotundo said.

NMU offers two loans to full-time student: the direct loan and the direct PLUS loan. The direct loan is funded through the Federal government and requires students to have a completed FAFSA on file. Students must also be making satisfactory progress with NMU and have to be enrolled at least half-time (6 credit hours). This loan can be deferred until the student graduates or stops attending school.

The direct PLUS loan is a loan that parents can borrow on behalf of their dependent student. The parent must qualify for the loan after filing an application. This loan may also be deferred until the student is out of school.

Even though there has been an increase in the amount students are borrowing from the federal government, there has been a significant decrease in the amount of private loans that students are using, said Scott Thum, assistant director of financial aid.

“There are new regulations every year when it comes to federal loans,” Thum said. “Students are able to borrow more from the federal government.”

Private loans are not regulated by NMU and therefore have different regulations. The financial aid office recommends using the maximum amount of federal loans before resorting to a private loan.

“We didn’t want to see an increase in the amount of federal loans students are using,” Thum said. “It was nice to see that even though the overall debt has increased, the private loans have significantly decreased.”

While loans are a good way to pay for school, there are many things that students can do to stay out of debt while attending college, Rotundo said.

“The big thing is to borrow smart,” Rotundo said. “Students need to understand the difference between wants and needs.”

Tips for reducing college costs

1. Plan to graduate on time; needing longer to graduate increases your overall tuition costs. Take the maximum number of courses you can handle each semester and consider summer terms and inter sessions.

2. Shop for books and supplies carefully; check online for discounts and used books.

3. Watch personal expenses closely; create a budget and set spending limits for yourself.

4. Look for a scholarship. Check scholarships at your college, and visit your academic department to see what’s available.

5. If you’re interested in serving in the military, check with the Reserve Officers Training Corps office on campus; branches of the military offer scholarships to enrolled students.

6. If you haven’t been assigned a job in your award letter, visit the student employment office and ask them to help you locate part-time work. Research shows that although students who attempt to juggle full-time work and full-time college struggle, those who work a moderate amount often do better academically.

7. Search for on-campus work that coincides with your career goals. Such positions can increase your knowledge and network of connections to the university while bringing in money. These jobs may even have to pay more than minimum wage to secure applicants.

8. If you are having trouble paying your bills, contact the financial aid office and discuss your aid award and options. If your family has experienced an unexpected decrease in income or increase in expenses since you applied for financial aid, consider asking the financial aid office to reevaluate your financial aid eligibility.

(from collegeboard.com)