He graduated in May. Last disbursement was January 2016.
@rockvillemom Oh, got it. I have two very good friends who are in the same situation. One graduated from Georgetown and another from University of Pennsylvania. As we chatted about my sweet girl heading to George Washington as a freshman (in comparison to other less expensive schools) they said what gives them solace regarding the PPL payments is the success their kids have had since graduating. One is in a graduate program in Berlin, Germany which is being paid for by their employer. The other is in law school and received scholarships to cover most of the cost.
Isnāt that whole delemna that parents find themselves in? Is it worth borrowing money for this school? Will this more expensive school give my child a better start in life? With no crystal ball to see the future, how does one make a sound decision that is not full of emotion? If it works, then it is worth it. If not, then it is a cautionary tale.
Nothing doing hereā¦ we have 5 kids, so they can take their guaranteed loans, they can find some other merit money and an affordable place to go, take the fixed amount we are willing to currently contribute and manage with a less than ādreamā school - so far we are 4 for 5 doing just fine with that.
This article about retirees taking their kids student loan debts into retirement scared me.
and never once was either political party that created these loans ever blamed I believe bankruptcy as it applies to college loans was passed under GW Bushās admin?.. Even when Liz Warren was screaming about the outrage of college debt and I tend to agree with her,no one ever brought up why the government blessed some of these loans at 7% yet paid their own bond investors 1.5% on 10 year treasuries they issued! She mentioned this but because wall street shut her up the issue died down. College loans are not tied to or correlated to the CPI, salary increases or even spread margins that are considered reasonable. These spread margins are usurious!
Yes - 7.21% and 6.84% - it is outrageous given the overall interest rate level the past few years.
Not even close. The criminal usury rate in most states is above 40%, and a supervised lender (licensed by state or feds) can often go higher than that. For any other unsecured loan, you are going to be paying above 10%, and there is going to be a limit on how much you can borrow in the $10k range. Credit cards might be at 7% for those with very high credit scores from their local banks and credit unions, but most cards issued from Chase or B of A have rates in the high teens. Unsecured credit has its price.
@threebeans I am stunned that people actually DO that
Payday loans have amazingly high interest rates and are widely located throughout our state and I suspect many others. They make CC interest rates look modest!
To me it looks like a trap. Whoever said this is a man eat man society was not wrong after all!
This is so timely for us. My D has gotten into a couple of privates and they have offered her good scholarship money but our out of pocket is about $10-15 K per year than the state schools (who also gave her scholarships). She really wants to go somewhere that is smaller and the privates allow that, but we are questioning the cost. I knew I didnāt want to do PLUS loans and most of the privates didnāt even put that on their Financial Aid awards, and most have told us they donāt view them as aid. This just confirms it.
The PLUS loans are not āaidā - they are a financing option. (Just like the mortgage on your home is not āaidā ā it is an obligation, but for most of us the only way that home ownership is possible).
You are eligible for the PLUS loan whether or not it is listed on the financial aid award package. But it is only one borrowing option ā I think it is a better option than a private unsecured loan, but under some circumstances a family that chooses to borrow may do better with a HELOC instead. There may be other sources of borrowing that may make more sense financially as well ā for example, one could borrow against accumulated cash value in a life insurance policy.
Has anyone tried the Sallie Mae student loans that came out last year?
Following for Sallie Mae
The Sallie Mae loan is just a private loan option. If you think the rates and terms are better than BofA or Discover, or Plus, then go for it.
Iāve heard some parents getting really good terms from their credit unions or bank, local (or state) loan options, but usually the total amount borrowed is under $10k (for all years). The benefit of Plus loans is that, currently, the amount borrowed is not limited except by COA. Martin OāMalley, the former governor of Maryland, thought borrowing $350k in Plus loans was a good idea. Mike Pence, current VP of the US, has Plus loans.
You have to decide what is good for your income level, your future earnings, your age.
The other benefit of a PLUS loan (vs. any other private loan) is that there are a few protections built in against adverse events, like loan forgiveness or remission under some specific circumstances (such as death of the student). Not a reason in and of itself to choose Plus over an alternative ā but something to factor in.
I took Plus loans, very carefully structuring them to keep payment levels affordable, and paid them all off within 2 or 3 years of my younger childās graduation. I knew that when my kid graduated I would have more discretionary income and would be able to accelerate payments ā and as I paid the loans off early, I did not pay all that much interest over the life of the loan.
Following. I have been advised against Parent PLUS loans and if we choose private student loans, cosigned by us, that we should also get a life insurance policy on our son, as morbid as that sounds. I am so confused. But this thread is very helpful.
@ahill70 Iād be wary of private loans. They offer few of the protections and options of government ones. As for the 'morbid" poster above, thatās a reality and is one reason government loans are preferable. Check the death/disability/consolidation/refinancing options. Private loans are not comparable in these terms.
These loans are generally not a good idea.
The sad reality is that college has gotten so expensive for the middle class that families have few options. Not every child thrives at a large state flagship. Some do better in a smaller environment like those provided by private colleges.
Sadly, many need to access this credit in order to make college possible.