<p>My husband and I are hearing all kinds of negative feedback on the parent plus loans we took out for our son in college. What are some other loan options and should we not be using the parennt plus loans? I am afraid we are getting in over our heads with this type of loan! ANY feedback would be appreciated!</p>
<p>Obviously, if you feel that you’re getting in over your heads then the answer is to re-evaluate what you can afford to contribute to your child(ren)'s education. Can you elaborate a bit on what kind of negative feedback you’re getting and what the source of that info is? Parent Plus loans do offer certain advantages over other types of loans, but are not always the most cost-effective. It usually pays to examine all of your options, including private education and home equity loans and then make a choice that is appropriate for your own situation and comfort level. For many of this, the list choices include the refusal to take on any parental debt, which is my personal favorite! You can find a good bit of general info on your choices at finaid.org.</p>
<p>Certainly examine all your options–tax ramifications, liability, etc. Home equity loans are fine IF you’re convinced you’re going to continue to have that equity & not go underwater, because they’ll probably be at a lower rate than the Parent PLUS loan. But I’ve been a little skeered of tying education loans in with anything dealing with my residence. Hard to get forbearance or deferrals on home equity loans or your mortgage. But Parent PLUS loans are fairly easy to manage, and to defer if you have to for awhile.</p>
<p>Are u being told that you’re borrowing too much? How much are you are borrowing each year. </p>
<p>Do you have other kids to put thru college</p>
<p>It is not PLUS loans that are the issue (except for possible better interest rates elsewhere). It is any loan and how much you are borrowing relative to your ability to pay it back. If you have a 0 (or other low EFC, based on a low income and assets) and are borrowing large sums of money that you will have difficulty paying back, then yes - it is a problem and you should heed the negative feedback. If the sums you are borrowing are reasonable sums for you to repay, then there is not a problem. I guess PLUS loans are a problem because it is easier for people to qualify when perhaps they should not.</p>
<p>Obviously this will differ by person. For some families borrowing, say, $15,000 a year might be doable if their income/assets makes that an amount they can pay back without too much risk to the parents financial future. For a lower income family that might be much to much to borrow. For instance, we would not borrow that sort of money at this stage in our lives (older parents, Dad retired and in poor health) as we know we could not afford it. Another for instance, a lower income family borrowing huge sums to send their kid to a dream school that does not give good aid (such as NYU) should definitely rethink what they are doing.</p>
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This remark greatly concerns me. If you think you are getting in over your head, you probably are. Calculate your future repayments (for all 4 years of loans) and determine if you can actually afford the repayments. (finaid.org has a loan repayment calculator that you may find helpful). [FinAid</a> | Calculators | Loan Calculator](<a href=“http://www.finaid.org/calculators/loanpayments.phtml]FinAid”>http://www.finaid.org/calculators/loanpayments.phtml)</p>