7 Things You Can Use College Loans For, Besides Tuition

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Can you use student loans for a laptop? Or how about spending your financial aid to buy a car?

You don’t have to wonder, though, because there are clear rules about how students can (and can’t) use college loans. Alcohol or road trips don’t make the list, but you might be surprised by what does.

1. Room and board
2. Transportation
3. School computer or other equipment
4. Travel costs for study abroad
5. Child or dependent care
6. Accommodations for students with disabilities
7. College loan fees
What if I have leftover student loan funds?

7 costs you can pay for with college loans

Usually, student loans can be used to pay for any expense that’s part of your cost of attendance. Colleges and lenders use that dollars-and-cents figure to determine how much you’re allowed to borrow.

In fact, lenders contact your college to certify your cost of attendance and will let you borrow only up to that amount.

Lenders will disburse these funds to your college, and they’ll be applied to any outstanding charges on your student account. The remaining funds are then given to you, and you can use them for any number of costs related to your education.

Some uses for these loan funds are obvious, such as tuition and fees. But others aren’t. Here are some other things you might not know you could pay for with college loans.

1. Room and board

Full-time students can use student loans to pay for basic living expenses, including rent, utilities and food. Most colleges set their cost of attendance to include “reasonable expenses” for your specific living arrangements and your area’s cost of living, according to the Office of Federal Student Aid.

For students living on campus, these estimates are based on the college’s own pricing for campus dorms and college meal plans. For students living off campus, these estimates should reflect market rates on groceries, rent and utilities.

2. Transportation

Can you use student loans to buy a car? In fact, college loans can be used for all sorts of transportation costs related to commuting to and from classes. For example, you can use student loan funds to cover expenses such as gas, car insurance, on-campus parking permits or fare for public transportation.

Of course, buying a car with financial aid wouldn’t be the wisest move, particularly if you could take the bus or train at a significantly lower cost.

3. School computer or other equipment

You also can use a student loan for supplies, from low-tech to high-tech equipment, including a personal laptop or computer to use for your studies.

Just keep in mind that using student loans for a laptop essentially increases the cost of that laptop. After all, you’d be paying for it with money borrowed that will accrue interest over time. Saving up part-time income and paying for such educational equipment is smarter, when possible.

Other items on the list include study aids and supplies specific to a class, such as paint for an art class or a graphing calculator for a calculus course. This list could even include computer software or apps you use, from word processing to advanced coding and computing.

If you’re wondering how to use student loans for books, consider renting your textbooks instead to reap major savings.

4. Travel costs for study abroad

Want to use college loans to travel? You won’t be allowed to borrow for an epic spring break, but you could use student loans for a study abroad program.

If you enroll in a credit-granting study abroad program approved by your college, all the costs related to that program can be covered with student loans. Those costs include the tuition for your credits earned, of course, but also the lodging and transportation expenses related to your trip.

5. Child or dependent care

For caregivers and parents headed back to school, one of the biggest challenges can be finding time to devote to your studies.

Student loans can help cover the costs of child care or other dependent care, including any care provided so you can attend class, commute to campus, study, work on assignments and complete internships. Your college will estimate what you can borrow for child care based on reasonable expenses for your area.

6. Accommodations for students with disabilities

Students with disabilities can use their student loan funds to cover the costs of the accommodations and support they need to attend and succeed in college.

These costs can include specialized equipment, a personal aide or tutor, transportation and other services and supplies that are “reasonably incurred.” Note that you can’t (and probably shouldn’t) borrow to cover any expenses already paid for by another agency.

7. College loan fees

Lastly, there’s the cost of borrowing itself. All federal student loans and many private student loans charge a student loan origination fee.

This fee is usually a percentage of the loan amount, and it’s withheld from funds before they’re disbursed. A 2% fee on a $5,000 loan, for example, would be $100, and the remaining $4,900 would be paid out to you.

Of course, since the fee is automatically withheld, you have to pay for it with college loans. The good news is your cost of attendance will be adjusted accordingly.

What if I have leftover student loan funds?

If your student loans covered your tuition and fees, you might be wondering what to do with leftover funds. Before using that student loan for a laptop or another big-ticket item, consider potentially smarter options.

You can use the funds for your next enrollment period, but you also can return unused student loan funds to cancel out that portion of your debt.

If you decide to return federal loan funds within 120 days, you could get that portion of the loan canceled outright. If it’s been more than 120 days, you can repay the funds to the loan servicer to lower your balance. Talk to your financial aid office for help returning student loan funds.

Whether you’re borrowing federal or private college loans, most of the same rules for how you’re permitted to use the funds will apply. Knowing what student loans can be used for may help you manage costs more effectively.

If you’re still worried about financing your school supplies and other secondary but significant costs, consider ways to save on college expenses before borrowing.

Andrew Pentis contributed to this report.

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