PLUS Loans... are they worth it?

<p>My parents are stubborn and refuse to pay a cent toward my college education (and our EFC's not that high, either.. about 10K). They expect me to pay it all off in loans, but of course, a vast majority of the loans I've received have been the super-big PLUS loans that I can't even pay off myself.</p>

<p>I want to go out-of-state for college, where it will be approximately $40,000 a year. So this means around $30,000 in PLUS loans, not counting work study and other student loans I've been given.</p>

<p>As angry as I am for them placing me in this predicament (also encouraging me to apply out-of-state and then telling me I can't go because it's too expensive), I also DON'T want my parents to accumulate all of this debt because it's not like I'm the only child.</p>

<p>I want to go out-of-state really badly, but I'm not sure taking out these gigantic loans will be worth it. Does anyone have any personal experience/words of advice? Thanks in advance. I'm stuck in a huge predicament here and I don't know what to do.</p>

<p>$30K per year in Plus, on top of Stafford loans, is way too much and you’re wise to realize this now. Do you have instate alternatives that are more affordable? If there are none, what is your plan B…will you take a gap year and reapply to more affordable schools? That would make more sense and would allow you some time to work and save money…disappointing, I know, but unless you can find some big merit money it’s very difficult for you, as a student, to cover the full cost of an OOS school. It’s very possible your folks are basing their decisions on they way things were when they went to school and had no idea how much things have changed. It’s better to take a step back now than to bury yourself in debt and there’s a chance that they’ll come to their senses in the meantime (assuming other pressing financial difficulties aren’t a factor).</p>

<p>Btw, Plus loans will be in your parent’s names and will impact their credit…do they realize that?</p>

<p>The Plus loans would be your parents’ loans, not yours. If your parents are insisting that they’re not paying, then they won’t likely take out Plus loans because legally the loans would be their responsibility. That would also create a problem when your younger siblings go to college because your parents would have the outstanding Plus loans from your situation.</p>

<p>Another problem is that Plus loans are awarded based on the parents’ credit. Since you have an EFC of $10k, the family income doesn’t sound very high, and therefore, they might qualify for the first year, but not for the subsequent years. Then you’d have a big problem.</p>

<p>Seriously, you can’t go out of state. Your parents were wrong to encourage you to apply OOS when they had no intention of helping you pay. </p>

<p>Where else did you get accepted and what FA packages did you get from them?</p>

<p>I only applied to 2 school in-state, both of which I was accepted to and WOULD consider as a last resort (so I don’t absolutely hate them). Although they are cheap, they also harbor extremely low graduation/retention rates and I am scared about job prospects and possibilities. The rest of the schools I applied to were OOS. </p>

<p>What frustrates me the most is that my parents actually allowed me to visit my 2 top-choice schools (both of them not in CA), and I ended up really loving both of them, and NOW I find out that I “can’t go.” This is why I was considering using PLUS loans as an absolute last resort, but I don’t know if my parents are ready to take on all this debt. They recently separated, which has caused a severe dent in finances.</p>

<p>Low grad/retention rates may be a sign of a school that kids are using as a stepping stone…like a financial or academic safety, which is exactly what it is to you! Unless their rates are severely low, it may not be a good indicator of anything amiss…if you post the names, you may get some responses from the CA posters. </p>

<p>If these are all FAFSA schools, you may want to consider waiting a year. Your parent’s separation is going to be a factor in many things, including your EFC. I don’t know if you can request a special circumstances adjustment based on a post-filing separation, but you may want to look into that. Otherwise, if the separation continues, you will file your next FAFSA with only your custodial parent’s financial information. That may make you eligible for Pell grants and other forms of aid…not sure how the CalGrants work but it might be something to consider.</p>

<p>*I only applied to 2 school in-state, both of which I was accepted to and WOULD consider as a last resort (so I don’t absolutely hate them). Although they are cheap, they also harbor extremely low graduation/retention rates and I am scared about job prospects and possibilities. The rest of the schools I applied to were OOS.

This is why I was considering using PLUS loans as an absolute last resort, but I don’t know if my parents are ready to take on all this debt. They recently separated, which has caused a severe dent in finances. *</p>

<p>The fact that your parents have recently separated is a strong indication that they will not take out Plus loans since the debt might be split if they divorce - and one parent may not earn as much as the other. Finances will already be hard hit by having to maintain 2 separate residences. If they divorce, lawyers fees will eat up even more of their money.</p>

<p>Don’t concern yourself with the graduation rates. Publics have lower grad rates and it really means nothing to YOU. Also, it would have zero effect on your job prospects.</p>

<p>Which Calif schools are they and what is your likely major?</p>

<p>The two schools were Fresno State University and San Jose State University. I wish to study journalism and/or creative writing. </p>

<p>Because my GPA wasn’t the strongest in HS, I was limited as to where I could apply and did not apply to any UC schools. I applied to these 2 as safeties but never really actually anticipated going to any of them. My mom is also angry with me because she thinks that with a higher GPA, I could have gotten more merit aid, so this isn’t helping my cause, either.</p>

<p>San Jose State is a very good school. My cousin went there and he’s now an airline pilot for a major airline. </p>

<p>I might choose SJS over Fresno St (unless Fresno has the better writing program). San Jose is ranked higher.</p>

<p>*My mom is also angry with me because she thinks that with a higher GPA, I could have gotten more merit aid, so this isn’t helping my cause, either. *</p>

<p>Well, maybe we can settle this between you and mom. What was your SAT or ACT? What OOS schools did you apply to? </p>

<p>Merit isn’t awarded by GPA, it’s awarded by having a high ACT/SAT **and **a high GPA. So, even if you had a 4.0, if your ACT/SAT wasn’t high enough, you still wouldn’t get merit $. Also, many, many schools don’t award merit money.</p>

<p>Also, keep in mind that your mom is very stressed because of the separation.</p>

<p>I had a 3.4 GPA, 1950 SAT, and I applied and was accepted to Indiana University (which is where I want to go), University of Arizona, University of Oregon, Miami University Ohio, University of Colorado-Boulder, and University of Missouri.</p>

<p>I wouldn’t have applied to all of these places had I known that there was no way of going to any. Oh well…</p>

<p>Well, having a higher GPA wouldn’t have done anything for you if your M+CR was under a 1330. And, frankly, even if you did have the stats, getting $9k would NOT have made IU affordable. It costs over $35k a year to go there for an OOS student. So, hopefully you and your mom can come to terms about that. Besides, your mom knew your GPA when you were applying, so it shouldn’t have been a surprise that you wouldn’t get great merit aid.</p>

<p>IU Distinction - $36,000 ($9,000 per year)
The IU Distinction Scholarship is awarded to the best and brightest out-of-state students who meet each of the following criteria:</p>

<pre><code>* Out-of-state student (domestic and international)

  • Minimum SAT score of 1330 or minimum ACT score of 30
  • Minimum GPA of 3.80 on a 4.0 scale
    </code></pre>

<p>Right now, you need to decide between Fresno or SJS. Have you visited both? </p>

<p>What do you like about each? What do you dislike about each?</p>

<p>I visited CSUF and I liked it well enough. I hate the school’s lack of prestige above everything else though. Literally all of my friends are going to schools like Cal, UCLA, USC, Ivies, etc, so I feel like the “stupid” one even though i could have done just as well of them had I not been so lazy in high school (yes, I realize that this is really all my fault and no one else’s, now I suffer repercussions). It’s just hard to get used to the idea of going there because when I visited other schools, they literally blew CSUF out of the water in every aspect.</p>

<p>leila, I don’t know anything about Fresno but I know that initial impressions can be deceiving. Many students have posted that they disliked their safety initially and ended up quite happy there. My own daughter felt the same about her safety and is quite happily finishing her freshman year there today! It was a rough start for her at a school with 27K students (she’s a quiet, small town girl) but she’s made great friends and there are tons of activities on campus. Moral of the story is that college will be the experience that YOU make it! If your only choice is instate, take your best choice and go in with a positive attitude. No one really cares where anyone else is going to school, and your true friends should certainly be understanding and supportive of you in any case!</p>

<p>Perhaps you could consider a transfer to a UC campus after a couple of years. That would give your parents some time to possibly resolve their marital issues and for you to save some money.</p>

<p>Did you visit San Jose? </p>

<p>San Jose is ranked higher and is well respected because of its proximity to Silicon Valley corporations.</p>

<p>Wow, sorry, but you come across as not just angry but entitled. Your pals are going to Ivies and UC’s because they did the work to qualify. </p>

<p>You like prestige – so make a name for yourself (Steven Spielburg did NOT attend the UCLA film school – he went some place teeny and then went and made great films). </p>

<p>Grow up. Your parents don’t owe you a dime. The cost of colleges have rocketed – so two years ago they may have thought that OOS was affordable. Now costs may be 25% higher and their lives are falling apart. Don’t be mad. Be compassionate. It might help them both a LOT if you quit whining and said “I understand. It’s disappointing and it is hard but I am ready to go and do what it takes to get the life I want. I will be ok.”</p>

<p>“I cried because I had no shoes until I saw a man who had no feet”. </p>

<p>I wish you would make dinner for your mom and tell her Thank You for supporting you in your activities while growing up. I wish you would do the same for your Dad.</p>

<p>^ Wowwww really? I KNOW that my grades were not high enough to attend a UC school, and I know that my friends were all obviously worthy of it because they worked hard in high school. Never once did I say “I DESERVE to and SHOULD go to a UC.”</p>

<p>And is there a problem with me being upset with my parents supposedly not being able to afford college? I know that my family is not poor, and although I don’t expect them to pay for EVERYTHING, I would think that they can at least contribute a little bit. Because paying off thousands of dollars in student loans by myself will be nothing short of daunting. </p>

<p>And for the record, I do appreciate my parents and everything that they have done for me.</p>

<p>If your parents EFC was $10K, they do not have much $. That is what the government estimated they could pay when they were <em>together</em>. They won’t be able to pay that if they’re living apart. </p>

<p>I know this is a disappointment to you but, honestly, it doesn’t sound like something you should be angry at your parents about in light of the separation. </p>

<p>I’m not interested in calling you names or criticizing you. I just want you to understand that sometimes in life, timing stinks. A lot of kids who always thought they were going to big name schools ended up not going because the market tanked. In the same way, your parents’ marital issues have repercusions in college planning for you. So, a few months back, they may have thought they could swing it-- but given the separation, that has changed. </p>

<p>Just focus on your life and what options you have to move forward and create the adult life you want. Before you know it, life will throw all sorts of curve balls at all your high school friends. You won’t even be in touch with many of them 10 years from now. But your loans or degree will still be there. </p>

<p>Where do you think you can succeed? Go meet some English professors. Take to your English teachers. Call some newspapers. Find out which school has the better internship program (critical for journalism). You have your whole life waiting for you-- don’t look back at all the what-ifs. And if you find that neither school is affordable or a good option, get a job and apply to some different choices next year.</p>

<p>I believe Amy Tan attended San Jose State at one point (along with other schools, she admits to a certain academic distractability). Many famous people went to colleges well below the top tier. Make the best of your situation and do not waste time worrying about what could have been, move forward and create what can be.</p>

<p>*If your parents EFC was $10K, they do not have much $. That is what the government estimated they could pay when they were <em>together</em>. They won’t be able to pay that if they’re living apart. *</p>

<p>hi_im…Is that EFC based on your mom’s income alone? Or did you file your FAFSA after your parents separated? For some reason, I was thinking that you filed after the separation since your family has already felt the financial sting from the separation.</p>

<p>I don’t blame you for feeling frustrated. Your parents knew your grades when they encouraged you to apply to your various colleges, so there was no reasonable expectation for big scholarships. It just sounds like the separation is causing a lot of stress in the family. Did your parents separate after the college apps went out? If so, that explains a lot.</p>

<p>Have you talked to your dad about how much he can contribute towards your college?</p>

<p>The FAFSA was filed after the separation, so that would explain the severe drop in income. My mother is currently unemployed and has recently returned to school so that she can get a well-paying job and not be dependent on my father. My father just got a second job in addition to his own business that he was running, so hopefully that should help.</p>

<p>Yeah, my dad and I are discussing it right now. He’s encouraging me to take out loans to attend the college I want and he says that he will help me to pay them back. Now, it’s a matter of deciding how much debt I want to be in when I graduate, so I can either attend the school I want and owe a lot of money or attend a state school and owe less (although I will still have loans because CA schools are getting pricey due to budget cuts). I am currently making a final decision.</p>

<p>Thank you for all of your help, it is much appreciated.</p>