<p>I'm posting this for a friend. She transferred to UCLA after spending 2 yrs at CCC. She is considered OOS, though she had expected to be IS considering she worked there and has a car etc during the 2 yrs she spent there. Anyway I told her IS status at any school, including UC is very difficult, but she said she could get around it. She didn't.</p>
<p>Few months ago, she decided to accept the offer of admission at UCLA and I thought everything's good. Few days ago, she told me that the school only offered her pell grant, and 7.5K subsidized loans, which means she has to come up with ~40k elsewhere. Her parents are willing to contribute 10k, so she's thinking of taking out 30k of private loan. She still has 2 more years to go, so I suggested that it's a very bad idea because it'll financially cripple her for at least five years after she graduates, provided that she finds a job right away. </p>
<p>I asked her why she choose to go if she can't afford or calculate the $$$ in the first place. She was admitted so Cal Poly as an in state(weird i know), however, she turned it down. And now it's too late to consider Cal poly too.
I suggested that maybe deferring enrollment at UCLA for a year or try to transfer elsewhere. She will have 80k in loans after 2 years, with an econ degree.</p>
<p>Even if was a good idea to take out $40K a year in loans to go to a college, without a cosigner it will be impossible. She needs to pull her application, take a year off, and try again when she has the money. Or find an affordable college.</p>
<p>She can get her first Economic lesson before she goes away to college, by doing the math as to what her monthly payments in those loans will be. She is also putting her parents on the hook for those loans as co signers. Usually such private loans are not such great deals either. Why won’t her parents apply for PLUS which is more flexible in terms of repayment and may have better rates. Also, anything over $25K is tough for a student to get, even with co signers on the private market.</p>
<p>Has she looked at the numbers and discussed this with her parents? My friend’s daughter has put the family in a terrible situation because the creditors on her private loans won’t let her defer them; she isn’t making enough to pay for them, so they are coming after the parents. </p>
<p>This is a serious amount of debt and nothing to take on with a quick signature. She needs to discuss this with her parents. Not saying, that it may be the way to go, IF her parents can support her on this, understanding that they are on the hook as well as your friend.</p>
<p>If she is eligible for a Pell grant, her parents are low income. Given that, they should not take out large PLUS loans or cosign large private loans.</p>
<p>I thought I posted a response here…but I guess it didn’t post.</p>
<p>To anyone else reading this thread. You need to have a plan for paying the amount of costs your financial aid does not cover BEFORE you send in a deposit. This is something you must discuss with your parents. You just can’t assume that the money will magically appear.</p>
<p>Re: eligibility for a Plus loan…if this family is Pell eligible, will they even be able to secure a Plus (or any other loan) for the amount this student needs? Maybe not.</p>
<p>I agree with others…UCLA did not provide sufficient money to attend for this student. That being the case, they need to go to plan B (either gap year or less expensive college).</p>
<p>Since she is already in California, she should get a job there, and do her level best to fulfill any requirements for in-state status at the universities she prefers over CalPoly. She also should find out if CalPoly will let her come in January. Maybe they will.</p>
<p>This amount of debt is not going to be affordable for her. it will destroy her life. Better she spend a year or two now working at a low-level job and earning just enough to live on while she establishes in-state residency than she take on this debt load and then have to spend 10 or more years paying it all off.</p>
<p>There seems to be a lot of mention of having sent the deposit. Yes, the loss of a deposit hurts. It is intended to hurt so that those who do send in the money are serious about attending. However, just like when you play poker, it’s not the money you already lost that is at state when you are considering on continuing with the game, but the money you can afford to spend thereafter. The spent money, the lost money, the deposit, are all history. Done and gone. The big question is whether you want to risk further financial havoc which may ensue if you continue that path. </p>
<p>Some people, a lot of people, decide to take that risk, pay for a year, taking out loans, busting the bank, running up debts,and need that experience to realize they cannot afford a certain school or situation. Even they are better off than those who borrow it all, delay payments and then are stuck with unpayable loans coming due after college. It is a real burden to owe that money.</p>
<p>My kids did not borrow. Still, the two that are out on their own are struggling mightily in making ends meet, not in luxury but in poverty. They lived well all of their lives with us and are now dealing with the realities of living in low rent districts and still having trouble with the bills. Something goes wrong in a month and something always does, and they are behind. A few months later they owe a thousand on their credit line, are maxed out and have nothing to show for it. All necessities. A filling in a tooth coming out, an injury to the hand, the car having issues, going to a good friend’s wedding, losing one’s train pass, having to pitch in for the farewell lunch and gift for a co worker, needing new shoes, all are issues when you are on a tight budget. DS1 is literallly sweating it out this summer since he has no light suits. His work place is airconditioned, but his apartment is not. He’s been hanging out a lot here lately and is appreciating the full fridge, as well as the airconditioning. That laundry costs so much to get done is a reality that he never really faced either. He needs starched, fresh looking shirts for his job. He was complaining how every solution to his issues is more money. Yeah, that 's life. And they are lucky enough that we can provide some help for them living nearby and having some extras. That is not the case for many kids and families.</p>
<p>The UC’s are very stringent about students establishing instate residency. Your “friend” did not get instate status at her school of choice this year. It’s probably not likely she will get it next year either. UCLA is a very attractive school to many applicants from OOS who can pay the full price.</p>
<p>She needs to check the residency requirements as they vary BY SCHOOL. She may want to take a year off and apply again to CalPolySLO…hoping to retain her instate status and be able to afford to go there.</p>
<p>thanks for the responses. I told her to think twice before taking out the loans. She thinks that UCLA with 70K± debt is better than going to calpoly(there’s a prestige factor I guess).
I warned her about the consequences of the debt, i.e. what if she can’t find a job right away etc. She didn’t say anything. She ran some loan calculators, she’ll be paying 600/month for 10 years. She said it’s fine because she is still young. No matter what I tell her, she seems quite firm on her decision. Her parents are very supportive too.</p>
<p>At this point, I honestly think she’s going in the wrong path. I just hope she does not regret later on.</p>
<p>Where did she find a $600 a month figure? With $80,000 her payments will be closer to $900 -1,000 + a month - every month for 10 long years. (If she gets a good interest rate). Her parents will have to cosign for her, if they are able to with an income low enough to be eligible for Pell grant, which means they are reponsible for the debt if she does not pay it. </p>
<p>If my kids had ever wanted to go that much into debt i would have very strongly discouraged them. And I would never have cosigned. a. because I would not have wanted to enable them to take on a debt that was going to cripple them for years. b. because cosigning is hugely risky for the cosigner who is basically responsible for the debt.</p>
<p>She probably will regret it. That is a huge debt to start your working life with.</p>
<p>I am wondering if with a $600 a month payment she is forgetting to account for the interesst on the loan. $80,000 with no interest would be $666 a month for 10 years. But she will be paying interest, so the payment will be much higher. How high will depend on the interest rate she gets. At 6.8% (which she will be lucky to find), the payments would be around $925 a month EVERY MONTH FOR TEN YEARS</p>
<p>She said she’s looking at private loans, which she found to be 3%-4%. The APR can be as low as 2.8% or as high as 9%. I’m not sure how she interpreted that. I was a little skeptic about the number, since gov loans are at 3.4% or 6.8% whether its subsidized or not. </p>
<p>I agree, it should be higher than 600/month.</p>
<p>With no interest at all $80,000 would be $666 a month for 10 years. And that’s not going to happen. The likelihood of finding a loan for 3-4% is very very small. They may aadvertise them, most people won’t ever get anything like that (kind of like those $50 airfares I always see advertized and have never managed to buy).</p>
<p>By the way, how does she have $7.5k in subsidized loans? The max subsidized stafford for a dependent junior is $5500. The other $2000 will be unsubsidized with a 6.8% interest rate and interest starting to accrue immediately (unless she got a Perkins loan).</p>
<p>tell ucla that she lied about her citizenship. tell them that she is not legal here. as long as she didnt give her SS# yet, she might have a chance of getting instate tuition. and because she wouldnt be legal, the college will assume that her parents dont have SS# either, meaning she will get financial aid. if she went to a high school that is not in ca, she can say her parents moved/is moving to CA due to economy. i heard of someone doing this and is going to a school in ca next year. its not one of the UCs though so i dont know if it’ll work for UCs. but remember, this can be considered fraud so…</p>