Best options for loans for students (and parent) with good credit? (Texas residing)

Paying for College
1

<p>I maxed out my federal direct loans and I need to borrow about $8000. I was offered a Parent PLUS loan, but the interest rate is awfully high at 7.9%. Also, my parents will be primarily responsible for paying it and I want a loan that they will only have to cosign at most, and I don't want to worry about paying it until after I graduate.</p>

<p>I have good credit (mid 700s) and so does my mom (lower 700s). I was wondering what the best option for loans would be for us? Private and government loans are all okay. I live in Texas (for state specific loans).</p>

2

<p>Btw, the best loan I have found thus far is the Texas CAL loan with 5.25% interest: <a href=“https://helmnet.thecb.state.tx.us/borrowers/apply/LoanDisclosure.asp?AppType=AL&LoanType=CAL[/url]”>https://helmnet.thecb.state.tx.us/borrowers/apply/LoanDisclosure.asp?AppType=AL&LoanType=CAL&lt;/a&gt;&lt;/p&gt;

3

<p>Cosigning those loans makes your parent equally responsible. It just gives the lender extra insurance since they have two people to go after instead of just one. The loan goes on the credit record just as though it is theirs and if you don’t or can’t pay, they’ll go after the parents. If either of you die, the other is on the hook. </p>

<p>If you can get a good interest rate, and a loan on your own, great. If the terms of the loan are as workable for you (Remember, PLUS is very flexible) and the lower interest rate makes it a better deal even if there is less flexibility, go for it. Look around and see what the best deal is and then make your decision. But do remember that co signed loans are not always a great deal due to the two people being equally responsible for the rest of both lives.</p>

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<p>Yes, I completely understand the meaning of a cosigner. My mother would pay the 8k herself over time if I allowed it, but I want to be the one who is responsible for it first. I’m really just trying to get the lowest possible interest rate. The only flexibility I require is not having to pay until after graduating, which the PLUS loan doesn’t give.</p>

5

<p>PLUS does offer that option. They have a lot of flexible options. THat is one of the “plus” features. The problem with PLUS is that the interest rate is higher than what some folks can get outside. If your family has USAA, I read that they have great interest rates. You do have to shop around, but the sliding scales usually do not give you a good reading on what YOU will be offered. It will depend on your parent’s financial situation and credit rating and what they feel like offering you. My son could not get an advertised interest rate even with perfect credit and an income that could afford that payment. Had to have Dad sign, and with two of them on the hook, they still did not get that lowest possible amount. Turned out you had to be a customer of a certain bank to get the rate.</p>

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<p>My mother would pay the 8k herself over time if I allowed it</p>

<p>What about the other 3 years of loans? </p>

<p>You’re going to have about $30k in fed loans plus about $32k in private loans (maybe more as costs go up). </p>

<p>Do you realize that you’re going to have more than $60k in debt? How much of that will your mom pay back (and be able to pay???)</p>

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<p>I’m currently a Texas resident, but I’ll be attending NYU next year, and both of my parents will remain in Texas. Can I get Texas resident specific loans?</p>

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<p>I found this loan for Texas residents called the B-on Time loan. Essentially, if you graduate within 4 years and graduate with a minimum 3.0 GPA, they forgive your loans. Also, it has a 0% interest rate, so even if your GPA falls below that mark, it’s a good deal.
[url=&lt;a href=“HHLoans”&gt;http://www.hhloans.com/index.cfm?objectid=b00c090d-e45d-4f4b-89da195959930185]HHLoans.com[/url</a>]</p>

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<p>Thanks guys! Yeah, interest rate is really my main concern right now, and PLUS has a high one.</p>

<p>mom2collegekids- I received only $4000 in federal loans. Should I have received more? The $8000 is a maximum (a “just in case”) - based on how things are going right now, I’ll only need $6000 of that. Basically my debt shouldn’t be more than $10,000 a year, and that’s assuming I receive no other scholarships ever (as a female engineer, I’m hoping I will receive some in my jr/sr year at least). Since I’m doing engineering, my total debt should be well within the first-year salary rule.</p>

<p>Thanks erin! I looked into BOT loans, but they will not let me get one unless my school’s financial aid office allows me to access it. :confused: I assumed there was probably other qualifications, like an EFC limit - I think I will call a financial counselor and ask about it to make sure, though.</p>