Need Advice, Divorced Parents, Student Loans

Im a sophomore in college right now, I had a college fund setup by my grandmother which I have no burned through, so next semester I need student loans here are my struggles right now that I need advice on:

  1. My parents are divorced and my fafsa is filled out by my "main" guardian who makes 6 figures a year so I don't get any financial aid from fafsa.
  2. Im only being offered student loans from fafsa that require a co signer but both my parents refuse to co sign a loan for me(I don't have anyone else to sign for me either.)
  3. Ive applied for private loans but I keep getting rejected saying that they want a co signer.

My credit score is low 700’s right now. Not sure if that helps me in any way.

Not sure what my other options are or what I am to do about my next semester starting in January. As of right now Im a part time dishwasher working weekends only and doing school during the week, so obviously thats not a large source of income it gets me by with all my bills and other living necessities.

Any advice is appreciated.

Thanks

Yikes, I wish you had come here as a junior/senior in college. You’re really stuck. I can tell you this…do not start next semester w/o full funding in place. You probably will need to ask for a Leave of Absence for at least a semester or more…and then see if you can have a better situation. It might mean changing your “custodial parent” to one that earns less. It might mean working/saving for awhile.

Can you co-op next semester w/o paying for tuition? Or does your school require tuition be paid while co-opting?

Are you at an instate or OOS public or private Univ? How much is your annual cost to attend (room, board, tuition, books, etc.

Can you spend more nights with your non custodial parent when not in school? Does that person have a lower income?

If anyone reading this thinks they could be in this situation some day, don’t burn thru a college fund in the first 3 semester and then have nothing and no other sources left. Instead consider OTHER options that will allow you to use that college fund for the last 2 years, which are the more IMPORTANT years…or will allow you to use that college fund equally for 4 years. That means finding a school where you have very generous merit, and then the college fund can cover the difference for four years. Or, that may mean going to a CC for two years, paying for that with low student loans or personal funds, and then paying for the last two years using the college fund.

Another thought…you might need to take a leave of absence from your college for,the spring semester. You can work during that time…and also figure out how you can finance college.

During that leave…you can decide whether your current college is REALLY going to be affordable. If not…you can try to find less expensive options.

I currently go to the cheapest in-state school in my state(Tuition is roughly 12k a year or 6k per semester), and then around another 6k in living expenses per year. So roughly 18k per year total.

My other parent does have a much much lower income as they are retired. Unfortunately when I talked with my “main” parent about having my other parent do my fafsa they refused to let it happen. Legally on paper I lived with both parents 50/50.

But since my school is multiple hours away from them I have to rent out an apartment here instead. I didn’t have a lot of options when it came to schools, I did, in fact, choose the cheapest one out of all my choices though in order to attempt to keep my costs low.

If you lived 50/50, then "FAFSA requirement is that you use the parent who provided the majority of your support.
Usually this is the parent with the higher income.

Since when is a co-signer required for a standard federal direct loan, which is the primary loan you get based on a FAFSA?

My bet is this student is being offered the Direct Loan…and then the Parent Plus Loan…

The Direct Loan is a student only Loan!!

I am in fact being offered both loans, the issue is, one is about $2000, and the parent plus loan is about $8000. So yes I could take the $2000 but that doesn’t really solve my problem at all.

As a sophomore you should be able to take a federal direct loan of up to $6,500. This increases to $7,500 for junior and senior years. No co-signer required.

Are you sure you didn’t spend one more night with your retired parent than the 6 figure parent when you were not at school in the 12 month period before you submitted the FAFSA?

I get the feeling that perhaps the 6 figure parent thinks he or she needs to be the FAFSA parent in order to claim you as his or her tax exemption and get the education tax credit. This is not true.

@Madison85 No, I for sure did not spend more time with the retired parent.

@BelknapPoint I wish that were the case. Not sure if thats circumstantial on each person. Maybe I should try to call them and see if Im missing something.

It is the case, and it depends on the year in school, not any other circumstances of each student.

https://studentaid.ed.gov/sa/types/loans/subsidized-unsubsidized#how-much

If you haven’t filed the FAFSA for 2018-19 yet, you can fix this. It is the 365 days before you file, so if you’ve spent the exact same amount of time with each, then spend the next month or so with the other parent. Then that parent will be the ‘FAFSA’ parent. You don’t have to file FAFSA in October, you can file it in the spring.

For the spring, if you haven’t taken out any loans yet, you should be able to get $6500 for just the spring. Next year you can get $7500.

The PLUS loan is not made to the student. There isn’t a co-signer, the parent has to be willing to take it out in his/her own name.

Credit score doesn’t help you that much for student loans. They want to see an income that can cover the payments. The credit score is a small part of a private student loan, or any loan really. You could have a credit score of 800+, but if you can’t make the payments you aren’t going to get a loan for a car or a house which are secured debt. Definitely not getting an unsecured loan.

<<<as a="" sophomore="" you="" should="" be="" able="" to="" take="" federal="" direct="" loan="" of="" up="" $6,500.="" this="" increases="" $7,500="" for="" junior="" and="" senior="" years.="" no="" co-signer="" required.="">>>

If the student did not borrow for fall semester, then s/he can borrow 6500 for spring semester only. That’s still not enough to pay for tuition and room/board.

However, after this semester, there will be a serious problem. For junior year, the student can only borrow 3750 per semester.

I agree that the custodial parent is worried that if the retired parent’s income is used on fafsa that she will lose her right to claim child on taxes. Not true.

This student needs to talk to each parent about the current financial predicament to determine how those last two years will get paid.

This student and parents did very little long-range planning when the decision was made to go to this school. If the parents had no intention of paying much/anything for college, then the student should have commuted to a CC for the first 2 years, and then transferred to their university using the college fund plus some savings earned over summers.

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Hopefully this parent will understand the predicament and help pay for college.