<p>Would you take out a $100,000 loan to go to a school like Stanford, or take a National merit scholarship at a third tier school? Especially if you're into ibanking?</p>
<p>Fred,</p>
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<li><p>Just what do you mean by “a third tier school”? It means different things to different posters on cc, and I don’t think you will be able to get meaningful answers to your questions unless we have a really good idea of what kind of school you are talking about.</p></li>
<li><p>Personally, I think 100K debt is way too much for any new college grad, no matter what major or career they have pursued. Your choices will be very limited, you will not be able to travel, it will be years before you buy a house, and it might be some time before you find a Mrs. Burger who doesn’t mind marrying into that kind of debt.</p></li>
<li><p>Why do so many students find themselves in this predicament? There are numerous top 50, even top 20, universities that offer very hefty merit scholarships to Stanford/Ivy worthy students. Not every Ivy/Ivy-like admit gets one, but a good number do. (Unless that is what you mean by “third tier”).</p></li>
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<p>By third tier I mean Ohio state or something similar, considering I’m national merit and could attend for free. Also, since I’ve already been admitted to Stanford, I really can’t bare the fact that I wouldn’t attend.</p>
<p>As much as I like Stanford, I don’t think it is worth taking on 100k of debt. As midmo stated it will affect other parts of your life (including your credit worthiness, which will be a factor if you decide on professional school)</p>
<p>You will pay off $100,000 over 10 years as follows:</p>
<p>Loan Balance: $100,000.00<br>
Adjusted Loan Balance: $100,000.00<br>
Loan Interest Rate: 6.80%
Loan Fees: 0.00%
Loan Term: 10 years
Minimum Payment: $50.00 </p>
<p>Monthly Loan Payment: $1,150.80<br>
Number of Payments: 120 </p>
<p>Cumulative Payments: $138,096.57<br>
Total Interest Paid: $38,096.57 </p>
<p>Now for the bigger question: if you don’t have your parent’s support, who is going to loan you this money.</p>
<p>right now the maximum amount of loans that you can borrow through the stafford loan program are:</p>
<p>3500 freshman year
4500 sophomore year
5500 junior and senior year</p>
<p>if your parents have been turned down for a PLUS loan can borrow an additional unsubsidized $4,000 the first two years and $5,000 the remaining years).</p>
<p>My parents will cosign the loan, from a private lender. Depending on how Stanford’s FA changes it may not even have to come to taking out a loan, but I’m setting up the absolute worst scenario. $1150 a month doesnt seem that bad, or is it? I don’t have a great grasp on things like this.</p>
<p>Did you apply to, and are you waiting to hear from, any of the top schools with merit scholarships (WUSTL, Emory, Vandy, USC, UVirginia, UNC-CH, UMichigan, Rice, Brandeis, etc.) as middle ground between S and one of the NMS full rides?</p>
<p>The scholarship gives you more choices, I think. The loan means when you get out of college, you have to pick a path that will pay for your loans. You have to pick the job that pays more over the one you might be excited about, you can’t take a year off to travel, all that sort of thing. I strongly believe that having as little post-college debt as possible allows you to have more control over your life path when you leave college.</p>
<p>$1150 is a lot. Especially with other living expenses from credit cards to cars. It’s a lot of money. And then there’s the option of graduate school, which is more. It’s your decision. Choose wisely.</p>
<p>A close family member was in a similar situation. She chose the cheaper one and regrets it to this day.</p>
<p>entomom, no I didn’t apply to them, which was a regret, but I didn’t think that I would be that competitive for a scholarship at those schools. I don’t plan to go to graduate school or travel around the world or anything (my family doesn’t do that sort of thing). However, I guess I can’t say for sure if I would want to attend grad school. asdfjkl1, do you know anyone who chose to go through with the loans and did it turn out alright? The reason I ask this question is to know if I’m shooting myself in the foot by not applying to other schools with National Merit scholarships really soon. Again, this is like the absolute worst scenario, but I like preparing myself for the worst.</p>
<p>That’s a whole lot of debt. I would hate to see a student burdening their future with those kinds of loans. As pointed out, there are a lot of options which become no longer feasible when saddled with debt payments. Another factor to consider is how comfortable you are knowing you need your parents to cosign each year. Lack of independence is another possible cost.</p>
<p>Another family member did choose to take the more expensive route and went Ivy. For MBA, too. She’s incredibly successful and was able to pay off everything within a few years. If you want to go into academics, you’re better off with the cheaper alternative. But if you want to go into business or anything corporate, Stanford on your resume will get you in the door. It really depends on what career path you’re interested in.</p>
<p>I think you’re smart for considering both. But, either way, I think it will turn out well for you. As 2blue suggested, definitely talk to your parents. Find out how much they’re willing to contribute. And, start applying for scholarships…everywhere.</p>
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<p>Oh for crying out loud. Ohio State University is a very fine school. If you have the “stuff” to get into Stanford, you also have the “stuff” to be in their honors program. The education you can receive at Ohio State University is very fine. This university is better than good…it is excellent. What makes you say it’s “third tier” and what in heaven’s name does that mean???</p>
<p>I didn’t mean to be belittle a school, and I know I can probably get into the honors program (which I think I might be guaranteed for). When I said third tier, I mean first tier the top 15-or so schools, second tier from BU-top 15, and after that third tier. I know that may not be your definition, and again no disrespect. I plan to be in the business sector, at least initially, especially if I assume that debt lol.</p>
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<p>Well…that’s the first time I’ve heard of “third tier” in that definition. Ohio State, for the record, is one of the top ranked public universities in the country. I believe you can get a business degree there!!</p>
<p>Stanford is an excellent university. Their MBA program is outstanding. If it were me… I’d go to OSU (free) for undergrad and get my MBA at Stanford…if you are lucky enough to be accepted into their program. </p>
<p>And by the way…a degree from Stanford will not guarantee you a job. It might get you in the door for some interviews…but after that, it’s up to you.</p>
<p>the problem with planning on the big bucks of i-banking is that several hundred of your Stanford classmates will be doing same (not to mention at the stars at hundreds of other colleges). Unfortunately, i-bank jobs are EXTREMELY hard to come by, and thousands of kids planning such a career will be disappointed if the only banking job they can get is selling stocks and mutual funds.</p>
<p>As thumper notes, a better might be MBA from Stanford (or Wharton) or the biggies in the NE corridor, if looking at Wall Street, or Haas if you want to stay in Calif.</p>
<p>Fred, does Ohio State give automatic, very large, merit scholarships just for being NMF? I don’t think so.</p>
<p>Another question, Fred. Have you already received a preliminary financial aid award from Stanford? Is it off by $25K per year?</p>
<p>If a school as good as Ohio State is your runner-up option, and the only way you can make Stanford happen is $100K in personal loans, then I think you need to consider very carefully the suggestions above about getting a big name MBA following your undergrad. degree from a low-debt school.</p>
<p>If you blew it on your application list and have no backup other than an actual “third tier” school (by which I mean a small non-flagship regional public that has essentially open admissions), then that might be another story. But surely you have not put yourself in that position?</p>
<p>Just some food for thought: the wealthiest man I know (as in net worth of hundreds of millions, possibly a billionaire if I can believe the newspapers) got his undergraduate degree at a small university you have probably never heard of (on scholarship), and an MBA from a very good university. With the MBA and a lot of brains and hard work, he started an investment firm with a different approach than the usual ones, and made it big. Since he had no loans to pay off, he was able to go to work for himself early in his career. That is what I mean by giving yourself options. I know, it is just an anecdote, but I know so many anecdotes. I find debt suffocating; others on cc take a different approach, and may chime in to give their opinion.</p>
<p>wow this is a no-brainer. You are smart enough to be a NMF, get into Stanford and you can’t figure this out?</p>
<p>go. be a Buckeye. you will probably find some kids there who are as smart as you are. save yourself $100,000. If being a member of Stanford’s marching band is the attraction then even that isn’t worth $100,000 that you don’t have. I can’t believe your parents would co-sign this loan. I wouldn’t.</p>
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<p>Just for the record. Ohio State University has an OUTSTANDING and very highly regarded marching band.</p>
<p>absolutely - I was just referring to their “renegade” reputation! I should have put in a smilie or wink or something - it was meant to be funny. sorry.
Not meant to knock Ohio State or their marching band in any way.</p>