Financing a college education is one of the biggest concerns for students and parents with children nearing college age. In fact, financial assistance is often a deciding factor in whether or not to attend college. There are many financial assistance programs available; Massachusetts offers a number of options to help.
When applying to a college or university, prospective students should evaluate the grants, scholarships, and other financial assistance programs available through the state and at the school of their choice. The Massachusetts Office of Student Financial Assistance (OSFA) recommends starting this process by completing the Free Application for Federal Student Aid (FAFSA) form to determine eligibility for all student financial aid – including state-based aid, the Pell Grant, federal student loans and federal work study. A FAFSA can be filed electronically, or through a high school guidance office or a college's financial aid office.
There are many loans available to students. It’s best to compare options to find one that suits your individual needs. College-bound students may want to consider the following:
- The Massachusetts No Interest Loan (NIL), a program created to provide financially eligible Massachusetts residents with a state-funded loan to attend a local college or university. Students that receive these interest-free loans have 10 years to repay them.
- The Massachusetts Educational Financing Authority (MEFA) helps students find an affordable college loan that fit their circumstances. MEFA's low-cost, fixed-interest rate loans offer consistent monthly payments and three repayment options.
- The Commonwealth Covenant Fund (CCF), provided by the Office of the State Treasurer, provides accessible tuition loan repayments to undergraduate students who attend public universities or colleges in Massachusetts, and stay in the state to pursue careers in the Science, Technology, Engineering and Math (STEM) fields.
- Direct Stafford Loans, from the William D. Ford Federal Direct Loan Program, are low-interest loans for eligible students to help cover the cost of higher education at a four-year college or university, community college, or trade, career, or technical school. Eligible students borrow directly from the U.S. Department of Education (DOE).
- Direct PLUS Loans are federal loans that parents of dependent undergraduate students, or graduate or professional degree students, can use to help pay for education expenses.
- The Federal Perkins Loan Program provides low-interest loans to help low- to moderate-income students finance their post-secondary education. Students can receive Perkins loans at any one of approximately 1,800 participating institutions. Borrowers who undertake certain public, military, or teaching service employment are eligible to have all or part of their loans cancelled.
Private and alternative loans
Before deciding on a private loan, students should exhaust all federal and state grant and loan options. Many private education loans have variable interest rates, which can change unexpectedly, as well as tiered interest rates (so-called "tiered pricing"), the prices of which are based on an individual’s credit score.
Additionally, fraudulent loan scams have become increasingly widespread and sophisticated in recent years. When dealing with private lenders, one should never send or wire money in advance of a thorough review of the lender and the loan terms. Anyone with doubts about the legitimacy of a lender or loan provider should contact the Federal Bureau of Investigation (FBI).
Resolving Loan Disputes
If a dispute arises about the balance or status of a loan, borrowers should identify the loan problem and contact their loan servicer. The Federal Student Aid website outlines common loan issues and steps to resolve them.
In addition to the financial help that’s offered by the Commonwealth and programs like FAFSA, it’s a good idea to save as much money as possible ahead of time to pay for college. The Massachusetts Educational Financing Authority (MEFA) offers loan programs, planning help and college savings plans like U.Plan and U.Fund.
U.Plan is a prepaid tuition program that enables participants to lock in current tuition and fees at participating Massachusetts public and private colleges for future attendees, while U.Fund is a market-based 529 investment plan that enables families to invest in portfolios of mutual funds with professional investment management.
College Tuition Deduction
Massachusetts offers a state income tax deduction for tuition payments made to two- or four-year colleges leading to undergraduate or associate degrees, diplomas, or certificates. The deduction is equal to the amount by which the tuition payments, less any scholarships, grants or financial aid received, exceed 25 percent of a taxpayer's Massachusetts adjusted gross income.
Education Benefits for Veterans
The Department of Veterans' Services (DVS) provides information on education programs and financial assistance for veterans, including tuition waivers, grants and scholarships for veterans, the Post-9/11 G.I. bill, among others.
Paying for Training
Those who want to hone their skills outside of a college environment can choose from the many training programs available to help them achieve their goals. Before enrolling, prospective students should evaluate potential sources of financial assistance, including scholarships and grants, loans, and more.
Full-time state employees – and their spouses – can participate in the Commonwealth’s tuition remission program, which provides partial to full remission of tuition for programs and courses taken on the employee's own time at public community colleges, state colleges, and state university campuses.