<p>Going into college I had the mindset not to occur any student loan debt if I could help it. Luckily, between PELL and TAP, my tuition in-fact is over covered (I get about 2500 a year back from these grants), making this goal possible. I'm going into my third year of college with no debt. Recently I've looked into getting student loans, researching interest rates and estimating monthly payments after I graduate. The reason for taking out these loans would potentially be for a reliable car after I graduate. </p>
<p>If I took out a loan(s) I'd like to take out 15-20k to put on a bank CD in it's entirety, meaning I'd only have access to this money when I graduate. </p>
<p>I'm thinking that I should take advantage of the flexible re-payment options and low interest rates of stafford and other federal student loans because after I graduate and want to have a reliable car or be able to afford some other relate-able expense with out taking out a loan with not so flexible payment plans and much higher interest rates. </p>
<p>I'm worried that I'm over looking something here. Is there anything else I haven't accounted for? Is this a good plan or should I stick to trying to graduate debt free? I just don't want to miss an opportunity for a loan like this. Thanks!</p>
I think you could only get $15000 of federal loans in next years of schooling and $4000 of that amount is unsubsidized which you have to pay 6.8% interest while you’re in school.</p>
<p>Also, grants and student loans can’t exceed your school’s COA. If you’re getting refund of grants which mean grants are exceeding COA, I don’t think they will award you any student loans.</p>
<p>If I took out loans it would be for something like this, yes. Most likely a car, because from what people tell me, the APR and payment options for auto-loans are no good. Obviously I’m seeking advice further than what I’ve heard so far.</p>
<p>Yes, from what I’ve researched so far that’s what I understand. I would take these loans out over the course of 4-5 years (I’m going for my masters). Sorry for not including that</p>
<p>Can you even take out that much? Note that the total of your award (grants+work-study+loans) may not exceed the cost of attendance for your school (whether that is living on-campus/off-campus/at home).</p>
<p>Yes, I’m sure I could take that much out over the course of the next 5 years because the cost of attendance for my college is estimated at about 10-13k while tuition is only $3,500 about, so my loans and grants over-cover my tuition every year by about 8-10k.</p>
<p>I bought an expensive car…and I put down a good chunk of the purchase price. I financed $15,000 and my payments are $325 a month. The reality is you could BUY a car for much less than I paid, and your payments would be much less. </p>
<p>I’m sorry, but I do NOT support taking out college loans so that you can purchase a car. </p>
<p>If you get a part time job, and save $200 a month for the next 5 years, you will have the money either to purchase a car, or to make a substantial down payment. </p>
<p>If you need a loan for a car, get a car loan when you have a JOB!</p>
<p>All graduate student loans are unsubsidized which you have to pay 6.8% interest while you’re in school. If you don’t, they would add the interests to your loans.</p>
<p>At the end of 4-5 years, you could owe a lot than what you put onto the bank.</p>
And if you want even more of an expensive car, up the amount when you have a job and are making more money. Save $1,000 a month if possible! Multiply that for a couple years and you’ll get a snazzier ride than this loan could give you. </p>
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Please, please, please, get a job. A job that can afford such a car.</p>
<p>I’m going to chime in with a slightly different tune here. Why don’t you go out and see what you can get in a car loan for the type of car you want to buy. Go through all of the steps just as you would if you are actually buying right now and find out what kind of financing you can get. Be aware that if you take out loans and stash the money, unsub loans are 6.8% and will acrrue interest the minute the funds are released so that if you are taking out the loan now, stashing the money to add to whatever else you can get in loans, you have to include the interest for that extra time. </p>
<p>However, if you are in a situation where having a car is going to be important and make the difference in getting a job, and you can’t get a car loan and family can’t cosign to help you out, this might be the way to go. Be aware, though, that owning a car is very expensive. You have maintenance, and insurance costs. If you can poissibly get by without one until you have a job, you should.</p>
<p>Living in a major city after my college days, I did not feel like I needed a car to check out job opportunities. Neither DH nor I had a car. DH bought one a year after graduation after he had a job when he found an opportunity that would require a car or a 1 1/2 hour commute each way. Still he did that commute for a month or so until he got his car. </p>
<p>Believe me, having a car is an expensive luxury. My oldest is having a rough time right now keeping up with his car. AC just went out, hard to keep up with the tolls and gas, and it’s hard to say no to venues that require a car when one is right at hand, something he just has to do or he’s going to continue to be broke. His car was out of commision several times due to money issues. My second son has no interest or use in a car, living in a city with transportation, and haveing a car would be like having a white elephant literally. In fact my oldest has run into trouble several times visiting his bro in the city with the car. The third one has bought a car because he got a job that supports having one and he can easily afford it and it gives him more options. Still,even though he is not in a major city with his job, he did not NEED a car, does not NEED a car, as there are bus options for him. He deliberately got a place on a bus route. But he is making the income for the payments and some extra in case of issues. That’s really the way to do it.</p>
<p>Whether a car is a benefit or burden partly depends on where you live upon graduation. If you live in some cities, you van get around very well without a car and maybe only rent one if you want to go on a weekend trip from time to time. </p>
<p>Cars can be purchased at many different prices. My sister just bought a 2-year old Nissan Altima with 6-year warranty for $15K from Hertz. They offered very reasonable financing as well. Agree that insurance, gas, parking at residence and work, and maintenance on cars IS expensive as well. Would second the idea of exploring the costs of purchasing a car, including all these incidental costs relating to car ownership. </p>
<p>Personally, I see no benefit to paying interest on loans now if you don’t currently need the funds–you’ll dig yourself into a hole.</p>