^^Wow!
I think the direct loan maximum is a good rule of thumb. I think the idea of using your annual starting salary is generally good but it breaks down if you are in a field where your ‘starting salary’ is something ridiculous because you have to work for free or nearly free in some kind of internship/entry-level position.
Another way that’s more time consuming is to try and figure out what your other monthly expenses will be (if your parents won’t be supporting you 100% which may not be possible depending on where your career opportunities take you). A lot of times it’s hard to really visualize what a debt payment can mean if you’re only looking at your salary and that one payment – If you’re making $1500 a month after taxes, a $350 debt payment doesn’t look that bad until you take into the account rent, groceries, utilities, insurance, car payments etc. as well as the fact that there are always going to be things going wrong that you might need to deal with.
As far as repayment terms, I believe the standard repayment term is 10 years. If you can do what rosered did that’s great because it saves you a lot in interest but the interest paid in 10 years is not unreasonable.
Thank you for everyone in this thread who offered advice! Fortunately, this situation was a complete false alarm! My parents gave me random numbers as an example, not expecting that I would take them to heart… they are both offering to pay half of my remaining tuition wherever I end up, with a limit of 35k/year each. Essentially, I could graduate with only federal loans. Over time, I would pay them back 20k each.
I now have a big decision to make. In all seriousness, you all helped me through an incredibly stressful week and I can’t thank everyone enough.
@nat97xo - So glad to hear this had a happy ending!!!
So this school will cost you $27k from the federal loans PLUS $40k that you have to repay your parents? The full cost to you is ~$70K plus interest? If that’s the case, it’s still too much debt for a film degree.
I agree with austinmshauri. I think $70K plus interest is too much. My husband and I are doing $40K for our daughters, and it is almost too much for us.
Oh for goodness sakes - the OP will have $27k in federal loans, plus an obligation to her parents (with presumably zero interest) that they’ve agreed to let her pay back over time. That’s a reasonable, and very generous, arrangement.