<p>A few years ago, my dad got laid off and racked up quite a bit of debt. I didn't think anything of it because my parents are going through a divorce and everything of theirs is completely separate. My mom's credit score was in the high 700's, she made plenty of money--too much for me to qualify for any aid--but I thought I'd be fine when I was applying for loans. If not, I had my dad as a backup plan for a cosigner. When we were applying for a loan, my mom got denied. My family refused to talk to me about it no matter how much I tried to reason with them, as they thought "it wasn't something I should need to know". Finally, a few days ago, I found out that my dad filed for bankruptcy a few months ago and it now is showing up on my mom's credit report. I know if you apply for the Parent PLUS loan and get denied, you get a $4,000 unsubsidized loan, and I can get the Stafford unsubsidized loan for $5,500. Because they refused to tell me anything, I'm running very short on time. I really don't want to suck it up and go to community college the next year until my mom sorts everything out, as I lose a $60,000 merit scholarship if I do that. My question is if that's my only choice. I need to borrow $17,000 and it's just really frustrating that I'm finding this out last minute and that I have no idea what I can do.</p>
<p>It sounds like your parents can’t come up with the money you need to pay for your university. They didn’t do it on purpose to ruin your chances, they got caught up in a bad economy.
Can you take a gap year and try to help your Mom save some money?</p>
<p>Perhaps it is a blessing in disguise.</p>
<p>If your parents would have had to borrow 17K this year, they would have had at least 68k of debt by the time you graduate</p>
<p>If you add this to the the stafford loans</p>
<p>$5500
$6500
$7500
$7500</p>
<p>this is another $26k leaving you and your parents with $93k in debt; which is way too much debt for an undergrad degree.</p>
<p>I agree with Aunt Bea, perhaps you can take a gap year, retake SAT/ACT to see if you can get some better merit options and to make sure that you put some financial safeties on your list now that you know a PLUS loan will not be an option.</p>
<p>You don’t lose your scholarship if you get the school’s permission to defer your enrollment for a year while you get the financing sorted out. I know that wasn’t your plan, but it may be necessary if you really want to attend this school. (And even with a deferment year, you’ll still only be able to attend if you can find a way to come up with the money.)</p>
<p>Another option would be to find someone with a good credit history who could cosign a private loan for either you or your mother. I agree with the above posters that it’s a lot of debt for you to take on . . . but if your really want to attend this school, this year, a cosigner would be the way to do it.</p>
<p>My son’s girlfriend from highschool was in the same predicament. Parents declined by PLUS, and that 's what everyone was counting on. They could not afford the school, and the school would not ante up any money. She had to find another option. She is commuting ot a local college and working part time.</p>
<p>Parents declined by PLUS, and that 's what everyone was counting on</p>
<p>I find these stories hard to believe. Since Plus is easy to qualify for, surely parents like this must be in some kind of denial when they apply. Once you miss some payments, etc, you lose your ability to qualify. That’s not a mystery or an unknown.</p>
<p>As for the OP, her dad’s debt likely was considered “marital debt” and once he stopped paying (and started Bankruptcy), the mom’s credit was hurt. Don’t know if a final divorce decree can fix any of that. If so, then waiting a year may be best. Or applying to schools that will give big merit.</p>
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<p>Maybe not unknown to you . . . but a parent who’s never done any of this before might not know that.</p>
<p>The thing was that it’s not my dream school or anything. I just needed a school to go to for a year because my dream school (that I plan on transferring to) doesn’t accept credit from community colleges. </p>
<p>I scored in the high 30’s on my ACT and took it three times with the same score, so I don’t know how worthwhile retaking it would be.</p>
<p>It’s not that we need to save up money. She needs to clear her record that she didn’t file any bankruptcy. It’s only this year she wouldn’t have been able to pay–the year we needed a loan for. </p>
<p>Even if I wanted to attend a local community college for a year and transfer somewhere else instead, all the classes I would need would be filled up by now. The one that serves my county only has English 101 and 102 open, both of which I’ve taken and gotten credit for already.</p>
<p>I guess then that’s it? Just take a gap year?</p>
<p>If that’s my only choice, do you guys have recommendations for anything I could do to build up my application? If I have to do this, I want to do something that stands out.</p>
<p>Sometimes the reasons are more than what parents want to share with their children, I want you to know. Your mother can call the fin aid office and work with them about the issue if she indeed can afford this loan. They can probably help her out. But, again, it might not be as simple as what she is telling you.</p>
<p>*Quote:
Once you miss some payments, etc, you lose your ability to qualify. That’s not a mystery or an unknown.</p>
<p>============
Maybe not unknown to you . . . but a parent who’s never done any of this before might not know that.
*</p>
<p>lol…I meant that it’s not unknown to the parent that they’ve missed some payments. It seems like some here act “all surprised” to find out that they didn’t qualify when surely they know that they’ve been loosey-goosey with payments. I realize that many may not have shared such with their kids, were in denial, applied for Plus, and then acted all surprised when they got rejected.</p>
<p>A few years ago, my dad got laid off and racked up quite a bit of debt</p>
<p>That was before the divorce…that was while they were still fully married. It’s not your dad’s debt…it’s both spouses’ debt. Your mom is equally responsible to get those debts paid off…maybe even more so if she has a bigger income.</p>
<p>*The thing was that it’s not my dream school or anything. I just needed a school to go to for a year because my dream school (that I plan on transferring to) doesn’t accept credit from community colleges. </p>
<p>I scored in the high 30’s on my ACT and took it three times with the same score, so I don’t know how worthwhile retaking it would be.</p>
<p>It’s not that we need to save up money. She needs to clear her record that she didn’t file any bankruptcy. It’s only this year she wouldn’t have been able to pay–the year we needed a loan for. *</p>
<p>there may be more to this then you’re understanding. It may NOT matter that your mom didn’t file for the BR. The fact is that she’s considered a debtor for those debts (marital debt) and if she doesn’t pay the debts (your dad’s debts) and your dad goes thru BR, then your mom’s credit is affected…and NOT for only this year. the creditors won’t care that your mom didn’t file…they’re her debts as well…she’s expected to pay or get the big dings. </p>
<p>Your dream school may not give you much aid when you transfer, have you considered that? What is your dream school?</p>
<p>I scored in the high 30’s on my ACT</p>
<p>What is your ACT composite?</p>
<p>Did you just graduate from high school or did you go to a CC last year?</p>
<p>Since Plus is easy to qualify for, surely parents like this must be in some kind of denial when they apply.</p>
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<p>I have had quite a few students denied Grad PLUS this year who were very surprised. I think the credit checks have tightened up compared to how they were in the past.</p>
<p>It is really tough when this happens so close to school starting, but the reality is that without the loan, you can’t afford it. I know you are disappointed, but there is some good advice here about possible options.</p>
<p>@mom2collegekids According to both of them and the attorney, it shouldn’t have happened and is a mistake on the mortgage company. My dad’s name is on the title of the house, but he hasn’t been on the mortgage in years.</p>
<p>Your thread isn’t making any sense. What shouldn’t have happened??</p>
<p>You said that your dad racked up debt after being unemployed. What kind of debt was it? Was the debt tied to the home in some way? Was it a home equity loan? You said that your dad’s name is on the property. It doesn’t matter if his name isn’t on the mortgage, he’s still an owner. </p>
<p>What do you mean by: “mistake on the mortgage company”? What has the mortgage got to do with it? The home isn’t in foreclosure is it? </p>
<p>You said that your dad declared bankruptcy. Bankruptcy for various debts, right? Credit cards? maybe other debts? If so, and those debts were incurred during the marriage than they are marital debts. </p>
<p>Are you saying that the creditors are going after the equity in the home? Your dad is an owner. Whether he’s on the mortgage would be irrelevant.</p>
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<p>It does not matter if they got the house or the mortgage since they have been married to each other. I would be considered a marital debt which both are responsible for until and unless they both address it in their final divorce decree and it has been signed off by the judge</p>
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<p>Call the financial aid office at your school, ask to have a dean call you back. Perhaps the school will make you an additional bridge loan while your mom and her attorney fix whatever is broken and then get the PLUS loan. Mortgage companies can act pretty quickly if they screwed something up and damages are about to occur because of it, especially when there is already an attorney involved. A rich school can have some amount of student loans in their portfolio for extenuating circumstances such as this.</p>
<p>CRD…do we know if this is a “rich school” as you’ve noted?</p>
<p>She needs to clear her record that she didn’t file any bankruptcy</p>
<p>I think THIS is what’s causing the confusion. It doesn’t matter that SHE didn’t file for bankrupcy. The problem is the dad’s debt was incurred during the marriage, so it was marital debt. Once payments were no longer being made on the debt by the father (it was still mom’s debt, too), then the mom’s credit score will be hurt…with or without bankruptcy.</p>
<p>Once the payments on the marital debt weren’t kept current, both parents’ credit was affected.</p>
<p>The parents seem to think that because he incurred the debt, and they’re now getting divorced, that somehow all that debt is his. That’s not how debt is looked at in marriage. Maybe they think that the “splitting of the debt” is “dad gets the unsecured debt” and “mom gets the secured debt (home)”. The dad’s name is still on the property, so wouldn’t half of the equity be his?</p>
<p>I also wonder if some of the debt was a home equity line of credit, taken out by the dad, maybe was unknown to the mom?</p>
<p>mom2collegekids, OP’s mom has an attorney. I’m not going to speculate. Different states have different laws. </p>
<p>I got a short-term loan from MIT at one point. It doesn’t hurt to ask. </p>
<p>Many people don’t know that you can ask. I’m telling the OP that you can ask. </p>
<p>I’ve also had a situation where the seller’s mortgage company never discharged the mortgage that they paid off. One call from the attorney and they acted very quickly. </p>
<p>That’s my contribution.</p>
<p>I’m thinking the mom and OP need to call the college, but I’m more troubled by the fact that the OP is thinking short term, already thinking about transferring etc. Might be smart to defer a year at this school giving the mom and her attorney time to sort out the credit situation and the OP time to figure out if this is even the “right” college before tacking on more debt for the mom right this minute.</p>
<p>MIT has deep pockets. Do we know if this college does?</p>
<p>I would advise against taking any type of short term loan because this student doesn’t know if or how it will be repaid…and that WILL be required.</p>
<p>Don’t attend this school this year. Ask for a deferral. In the next few months, hopefully this will get sorted out.</p>
<p>How much Plus loan money were you planning to take? If this is excessive, you might want to reconsider your college list and chase some merit money which will soften the financial blow.</p>