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According to The Institute for College Access & Success, 59% of 2018 college graduates in Michigan held student loan debt, and the average student loan debt in Michigan was $32,158 among those who completed a four-year (or more) degree.
One way to reduce student debt is by enrolling in a low-cost school. Fortunately, with as many as 44 public universities and community colleges (like the University of Michigan and Michigan State University) and 34 private, not-for-profit schools, there are many options to consider.
Maximizing certain Michigan financial aid opportunities is another way to lower student debt. Student loans should be a last resort — instead, explore scholarships and grants that won’t likely need to be repaid.
Let’s take a look at your options for paying for college in Michigan — specifically:
As well as…
Avoiding student loans in Michigan: Grants, scholarships and more
The state doesn’t offer its own student loan program, but it does provide students with Michigan grants for college and scholarship resources. Here are some awards to consider:
Children of Veterans Tuition Grant
The Children of Veterans Tuition Grant is open to biological and adopted children of Michigan veterans who:
- Died during wartime service
- Went missing in action in a foreign country
- Are totally and permanently disabled as a result of their military service
The grant award for full-time undergraduate students can be as high as $2,800, which can be renewed up to four years for a total award of $11,200. Award amounts will be dependent on your enrollment status.
You must have been a state resident for at least one year, and be within the ages of 17 to 26 to be eligible. You’ll also need to be enrolled at least half-time at a Michigan-based community college, public university or independent degree-granting institution.
Dual Enrollment
Dual enrollment is when enrolled high school students also enroll in college courses and receive college credit for a completed course. This opportunity is available if you’re in grades 9 through 12 and is limited to a maximum of 10 college courses.
Participating schools include community colleges, public universities or private colleges within the state of Michigan. Michigan’s Department of Education will determine the course payments and send funds directly to Michigan Student Aid. Your eligibility ends when you’ve completed high school, reached the college course maximum or received state funds for four academic years.
Fostering Futures Scholarship
The Fostering Futures Scholarship awards up to $3,000 to undergraduate students who have been in Michigan’s foster care system at age 13 or older. Scholarship funds may be used toward tuition, mandatory school fees, books, supplies and room and board at a participating Michigan college or university.
To apply, you must submit a FAFSA. Scholarship funds are limited and award amounts are based on your financial need and other aid you’ve received upon applying.
Michigan Competitive Scholarship
Undergraduate students entering their college for their first degree can receive $1,000 per academic year toward tuition and fees. The Michigan Competitive Scholarship is open to students who demonstrate financial need and academic merit.
You’ll need a minimum SAT score of 1200 before attending college and have a high school diploma or similar certificate. If you’re chosen as a recipient, you must attend a qualifying college at least half-time.
In addition, you and your legal guardian (if you’re a dependent) must have been Michigan residents since July 1 of the preceding year. This scholarship may be renewable if you meet academic requirements.
Michigan GEAR UP Scholarship
If you’ve completed the state’s GEAR UP six-year program and are college-bound, you might be eligible for Michigan’s GEAR UP scholarship. You’ll need to enroll in a qualifying Michigan college or university at least half-time.
Applicants must be nominated to be considered for the award, which provides a maximum of $2,000 per academic year. Recipients can receive a lifetime total of up to $6,000.
Michigan Tuition Grant
The Michigan Tuition Grant is a need-based grant that’s available to students who are enrolled at least half-time at a degree-granting Michigan nonprofit, independent college. Applicants must have a high school diploma or equivalent certificate. Students must also have been a state resident since July 1 of the prior year; if the applicant is a dependent, their parent must meet the same state residence requirement.
Recipients will receive an award of up to a $2,800 award per academic year, which is renewable based on academic progress. Students can only use these funds toward tuition and required school fees.
Police Officer’s and Fire Fighter’s Survivor Tuition Grant
Children and surviving spouses of Michigan police officers or firefighters who died while performing their duties can apply for a tuition waiver through the Police Officer’s and Fire Fighter’s Survivor Tuition Grant.
Applicants must be enrolled in a Michigan community college or public university at least half-time; students who already have a bachelor’s degree are not eligible. You must also have been a state resident for 12 consecutive months and under the age 26 before submitting the application (children must have also been 21 or younger at the time of their parent’s death).
The amount that’s awarded covers only the remaining tuition gap after all other financial aid that’s received is considered. This grant is renewable if you meet your school’s satisfactory academic progress policy.
Tuition Incentive Program
The Tuition Incentive Program (TIP) offers funding in two phases for students who have received Medicaid and are pursuing higher education at least half time.
Phase 1. Recipients are awarded the cost of tuition (at a standard rate for a local community college) and up to $250 in mandatory fees per semester or term toward an associate’s degree or certificate. The school must be an eligible Michigan degree-granting college or university with at least a one-year associate’s degree or certificate program.
Phase 2. Recipients are awarded up to $500 per semester or $400 per term toward a four-year program. Eligible Michigan schools include state community colleges, public universities or independent colleges with a degree program. You don’t need to be a Phase 1 recipient to be eligible. However, if you did participate in Phase 1, you’d need to complete Phase 2 within 30 months of completing the first phase.
Federal student loans in Michigan
Federal student loans are funded by the U.S. Department of Education. Loans are offered at a fixed interest rate and are the same for applicants seeking the same loan type. However, federal student rates do adjust every school year.
To apply, you must submit a Federal Application for Financial Student Aid (FAFSA). There are a few federal student loan types, including:
- Direct subsidized loans. This need-based loan is only available to undergraduate students and the school decides your loan amount. While enrolled at least half-time in school, during the loan’s six-month grace period or in deferment, the government pays any interest that accrues.
- Direct unsubsidized loans. Unsubsidized direct loans aren’t based on financial need, and are available to both undergraduate and graduate students. However, schools still decide the loan amount you’re eligible for, based on other financial aid you’ve received and the school’s cost of attendance. You’re responsible for any interest that accrues.
- Direct PLUS loans. PLUS loans are available to graduate and parent borrowers. This federal student loan requires a credit check and loan amounts are capped, based on the school’s cost of attendance minus other financial aid received.
When your federal loans are in repayment, borrowers have many types of repayment plans to choose from. By default, loans are put on a standard 10-year repayment plan with equally divided monthly payments. You can also choose an alternative plan, like graduated or extended repayment, and income-driven repayment plans are available if you’re in financial hardship.
If you meet eligibility criteria, your federal student loans could even be forgiven, a key advantage that federal loans offer.
Private student loans in Michigan
Private student loans aren’t funded by the U.S. Department of Education. Instead, they come from lenders like banks, credit unions and online lenders, including Michigan-based financial institutions. Since these student loans are from private companies, eligibility requirements, terms and interest rates vary between lenders.
One universal factor for qualification is your credit. Unlike most federal loans, private student loans require a credit check; if you don’t have a credit history, you may be asked to have a cosigner on the loan. In addition, these loans don’t guarantee the same protections that you’ll receive through federal loans, though available options also differ between lenders.
It’s generally best to maximize federal student loans, if you must. You’ll always have the option to refinance your federal loans into a private student loan. Be thoughtful with this approach, though, because refinancing your student loans could mean losing federal benefits and protections.
In-state vs. out-of-state tuition in Michigan
Tuition costs vary greatly whether you’re considered an in-state Michigan resident or an out-of-state student attending a Michigan school. This list shows the difference between the cost of tuition at four Michigan public universities:
University of Michigan
- Freshman and sophomore tuition and fees (in state): $15,558
- Freshman and sophomore tuition and fees (out of state): $51,200
Michigan State University
- Freshman tuition and fees (in state): $14,524
- Freshman tuition and fees (out of state): $39,830
Michigan Technological University
- Tuition and fees (in state): $16,436
- Tuition and fees (out of state): $36,738
Saginaw Valley State University
- Tuition and fees (in state): $10,035
- Tuition and fees (out of state): $23,599
In addition to state-specific grants and scholarships, like the Michigan Tuition Grant or Michigan Competitive Scholarship, some schools offer their own grant and scholarship programs for their students. Ask your school’s financial aid office to learn more about these funding opportunities.
Student loans in Michigan: FAQ
What’s the status of the Michigan Alternative Student Loan Program?
The Michigan Alternative Student Loan program was suspended in February 2008 and has not been reactivated.
How do I access the MiSSG Student Portal?
The Michigan Student Scholarships & Grants (MiSSG) Student Portal can be accessed through the Michigan.gov website. When you click on the “Go to MiSSG Student Portal” button, you’ll be redirected to a page to log in.
Where can I find the MI Scholarship Search Self-Service Tool?
The MI Scholarship Self-Service Tool helps students identify scholarship opportunities tied to a particular area of Michigan — for example, scholarships with a specific Michigan school, county, city or regional requirement. Start your search by selecting the county you live in.
How do I learn more about the GST Michigan Works! Scholarships?
To learn information about GST Michigan Works! Scholarships, contact your local GST Michigan Works! office.
Christy Rakoczy contributed to this report.
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