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    Using Student Loans for Off-Campus Housing

    By Kayla Korzekwinski

    Kayla Korzekwinski is a Scholarships360 content writer. She earned her BA from the University of North Carolina at Chapel Hill, where she studied Advertising/PR, Rhetorical Communication, and Anthropology. Kayla has worked on communications for non-profits and student organizations. She loves to write and come up with new ways to express ideas.

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    and Cait Williams

    Cait Williams is a Content Writer at Scholarships360. Cait recently graduated from Ohio University with a degree in Journalism and Strategic Communications. During her time at OU, was active in the outdoor recreation community.

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    Edited by Maria Geiger

    Maria Geiger is Director of Content at Scholarships360. She is a former online educational technology instructor and adjunct writing instructor. In addition to education reform, Maria’s interests include viewpoint diversity, blended/flipped learning, digital communication, and integrating media/web tools into the curriculum to better facilitate student engagement. Maria earned both a B.A. and an M.A. in English Literature from Monmouth University, an M. Ed. in Education from Monmouth University, and a Virtual Online Teaching Certificate (VOLT) from the University of Pennsylvania.

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    Updated: January 30th, 2024
    Using Student Loans for Off-Campus Housing

    Living off-campus can give students freedom and allows them to experience being on their own. However, off-campus housing comes with different costs than living in a dorm. Here are some things to keep in mind when using student loans to live off-campus!

    Cost of attendance

    Colleges offer financial aid based on the estimated cost of attendance. The cost of attendance includes the expenses of tuition, fees, supplies, room and board, transportation, and more. Oftentimes when students take out a loan, it is based on the cost of attendance. A good rule of thumb is to check the school’s housing allowance, and try to stay near that amount when borrowing loans for off-campus housing. 

    Both federal loans from FAFSA and private loans can be used to pay for off-campus housing because it is included in the cost of attendance. It’s helpful to decide if you want to live on- or off-campus as soon as possible so that it can be factored into your FAFSA

    Related: Where can I find student rent assistance?

    Student loan refunds

    One of the more common uses of a student loan refund is to pay for off-campus housing. Refunds can be used for other expenses associated with living off-campus such as utilities, groceries, and transportation. It’s easy to use a student loan refund! Once you receive the refund check, deposit the money to your bank account and pay from there.

    Consider all of your expenses

    Keep in mind the off campus housing will incur a lot of additional cost that on campus living will likely not. Consider the things below that you may not have realized you will need to pay for when you live off campus.

    • Wi-fi
    • Furniture 
    • Utilities and parking 

    Additionally, another important thing to keep in mind is that student loans are disbursed to your school first to pay for tuition and fees. The amount that you borrow may not be the whole amount that you receive to pay for living expenses. Student loans are disbursed once per semester. Be sure to budget accordingly to stretch your loans for as long as possible!

    Remember that food will need to be a part of your budget as well, whether you are living on or off campus.

    How to use student loans to pay for off-campus housing

    Using student loans for off-campus housing is a simple process.

    1. Deposit your student loan refund check or receive direct disbursement to your account

    2. Write a check or make payments for rent and other expenses as you normally would with your own money

    3. Keep an eye on your account and budget appropriately to ensure you have enough funds to pay for the whole semester

    4. Use the funds only for essentials related to your education

    Remember, student loans are not “free” money. Any funds that you use for housing costs will have to be repaid with interest. However, if you budget your funds and make good financial decisions, you will be able to live off-campus with your student loans!

    See also: How to apply for student loans

    Choosing between on campus and off campus housing

    Whether you choose to live on campus or off campus, there is no getting around having to pay for somewhere to live while you are in college. Choosing between on campus and off campus housing should come down to not what is cheaper, but what will better suit your needs and help you succeed! 

    So, let’s take a quick look at both living on campus and living off campus!

    On campus

    On campus living, which usually consists of double occupancy dorms, is the most common option that many colleges offer. Campus housing will typically cost you one flat rate for the semester, meaning you won’t have to pay separate bills for different amenities like you would in an apartment or house. Additionally, a lot of schools will require students to purchase a meal plan if they live on campus, which, while it is an additional cost, does simplify some things.

    Off Campus

    The biggest benefit to off campus living for most students is likely the privacy and freedom that come with it. Students do not have to follow university living policies and usually will live in a place that can offer them their own room, sharing a bathroom with less people and more room in general. However, living on your own comes with added responsibilities such as paying utilities, grocery shopping and furnishing your own place.


    While we did say that your well-being should be a higher priority than price, we will still take a second right now to talk about the costs. Which option is cheaper for living really depends on where you are and what school you are attending. In some big cities where rent is quite high, a dorm may be the cheaper option. However, in smaller towns, there may be little to no difference. Make sure you do your homework and explore both options thoroughly!

    Key Takeaways

    Key Takeaways

    • Remember that any student loans you take out will need to be repaid, even those that are used for housing expenses
    • Using loans to pay for housing is simple, but requires that you budget your money carefully because loans are only dispersed once per semester
    • Carefully explore your living options before deciding on anything too quickly
    • The cost of living varies greatly depending on where you are, which is why you should not just make assumptions about which option will be cheaper than the other

    Frequently asked questions about using student loans for off campus housing

    Can I use Sallie Mae student loans for off-campus housing?

    You can use Sallie Mae loans for educational expenses, including tuition, fees, and housing, whether it is on-campus or off-campus. So, you will be able to put them towards off-campus housing if you decide to.

    Can I use federal student loans for off-campus housing?

    Yes, you can use federal student loans to pay for your off-campus housing. Just make sure you receive documentation of your housing expenses so you can prove that it went towards an approved educational expense. This can be in the form of rent statements from your landlord.

    Does FAFSA cover housing?

    Federal aid from the FAFSA does cover housing, whether it is on-campus or off-campus. Your housing cost is factored into your estimated cost of attendance, so it is used to help calculate your EFC, or Expected Family Contribution.

    What can I do with leftover student loan money?

    If you have leftover student loan money, your best bet is to pay it back! Unless you need the funds for other educational expenses, you’ll thank yourself later. Paying it back means that you will have less to pay back once you’ve graduated, and you’ll pay back less interest in total.

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