<p>Hi, I'm a rising senior at MI high school and I will be soon leaving for college next year--possibly on a full ride. The thing I'm dreading is that I will leave my mom alone. She is in serious debt and I wanted to help her get rid of it as soon as possible. Basically, all she is doing is paying the interest rate and we keep on spending more and more. She is disabled so that money we get from is only from SSI. How do I go around getting loans to pay for this?
Can I get a student loan in college--even though I have a full ride--and then use the money to pay toward my mom's credit card (around 8,000)? Or is there a good company that you CCers know of that you recommend?? Thank you for taking the time to help me out!</p>
<p>What you are thinking of will probably not be possible. Student loans can only be given to satisfy "need," which is defined in the formula to be only the student's need to pay the cost of attending the school. If you divert the loan funds to pay Mom's credit card, you will not have enough money to attend school.</p>
<p>It seems to me, however, that you have a bigger problem than just a desire to temporarily relieve your Mom's debt.</p>
<p>Aubrey, do you have a job now? I think the most helpful thing you can do as a high school senior still living at home is to try to help bring in some income to the family. </p>
<p>There are credit counseling agencies that can help your mom negotiate with the credit card company for a modified payment plan. She has to stop using that credit card --- so you also need to work with her to figure out a budget so you and she can live within the limited income you have. I know that will be tough -- I honestly don't see it happening without your earning and contributing somewhat to household expenses. </p>
<p>You can use this web site to find a credit counselor who can help you out:
Welcome</a> to DebtAdvice.org!</p>
<p>However, before going to a credit counselor, read this page so you know what questions to ask:
For</a> People on Debt Management Plans: A Must-Do List</p>
<p>Aubrey, you sound like a great kid who really cares about her family. In the case of student loans in the student's name, typically these loans are dispersed to the college, not the student. So...you would not be able to access this money until (possibly) you had an overage at the end of the school year when you could request a refund. I don't think that will help you. To be honest, I would advise you NOT to incur debt to pay off debt...that is a dangerous cycle to be involved in. I agree, if you have a job now and can contribute to the household, great. And congratulations for finding a way to go to college without incurring debt for that!!</p>
<p>This time of year, I am selfish simply b/c I don't have the time to work amidst college applications, schools, extracur etc. So that's not an option for me right now. </p>
<p>Do you happen to know of any good loaning company out there that let you do whatever you please with it? The interest rates is killing us :(. My mother doesn't speak English so I must be the one looking out for this kind of stuff for her. Thanks in advance</p>
<p>Go to the credit counseling organization I suggested! They will help negotiate with the credit card company for a payment plan with reduced interest. </p>
<p>You will NOT be able to get a loan with lower interest rates -- trying to borrow to pay off debt will only magnify the problem -- you will end up owing even more!</p>
<p>The OP's MOM will need to go to the credit counseling organizations if the debts are in her name. Of course, the OP can go with her to help with the process. </p>
<p>To the OP...there are not loans available to students who typically have no assets or income to support the giving of the loan or the paying back. A bank or other lending agency is unlikely to give you a loan. </p>
<p>I agree with Calmom...the best thing you can do is help your family get out of this debt loop. Good luck to you.</p>
<p>Aubrey,</p>
<p>Have you tried getting your mom to apply for a Home Equity loan to pay off her credit card debt? Usually the interest rates on Home Equity loans are a lot lower than credit card interest rates. Your mom can apply for a Home Equity loan through your bank.</p>
<p>Good luck!</p>
<p>I think it would be better to talk to a credit counselor first.
I had huge credit card debt from when both my H and I were drastically underemployed ( down to babysitting and mowing grass) for over a year. We had to use credit cards to pay medical bills and groceries. However, with a late payment, the interest ballooned.</p>
<p>The credit counselor was able to get the credit card debts interest completely dropped, and they consolidated all the debt into one payment ( lower than originally). From what I understand, it is easier to negotiate with the card companies than to actually negotiate down a loan- I would talk to a counselor first.</p>
<p>I would be really afraid of getting an equity loan if you having trouble paying your bills, because if you run into more trouble you could lose your house.</p>
<p>Aubrey, though the answer to your question is "yes", the caveat is that those loans are not the ones that are recommended for you to take as the terms may not be as favorable as true student loans. True student loans will take the cost of attendance (COA) at a college, and this is a figure that is given by the college, and will only loan up that amount, offsetting it with any other financial aid and scholarships you get. You do not see this money as it goes directly to the college. </p>
<p>If your mother is so seriously in financial trouble with you there to help her, what will happen when you are gone? You still have to repay those loans, though with maybe lower interest rates, and unless you are making money, you are not going to be able to make those payments. Most loans that defer payment until graduation are those that will not let you get your hands on the cash for other purposes, and those that do will likely not have the favorable rates and terms and you and your mother will be no better off. </p>
<p>As others have advised, the best thing is to get you mother to a financial counselor and see what can be done here. It may be wiser for you to stay home, go to school part time and work part time if money is of grave concern and your mother is having issues taking care of herself. It is not going to be a good situation if you are away and distracted terribly about her plight. There may be some excellent schools that are within commuting distance of where you live that you should check out.</p>
<p>Where may I find this credit counselor person?
I'm only 17, not even old enough to apply for a credit card yet, and I'm just a little lost in this process. If anyone can walk me through this, I thank you.</p>
<p>Aubrey, if you look at my post #3 there is a link -- that will lead to a web site that you can use to find a credit counselor near you. As thumper mentioned, your mom will need to go -- but as she doesn't speak English, you should go with her to translate.</p>
<p>Not being judgmental on the wisdom or ethics of doing this, I think these people may be wrong and you probably can get a subsidized Stafford loan. You should do the research carefully however.</p>
<p>Undergraduate</a> Stafford Loan information from StaffordLoan.com</p>
<p>I had a full ride in college 30 years ago, and I was still able to get a subsidized Stafford (it was called something else then) Loan to replace the work-study I had in my FinAid package. I was then still able to get a part-time job outside of school that paid more than the campus work-study jobs would have paid and it didn't materially affect my FinAid award even after I told the college. I was also eventually able to become financially independent since I received no support from my parents who had negative income for my last year in high school and my first few years of college. </p>
<p>This may or may not work out for you, and it does bear substantial risk, but given your situation, I don't think it's as terrible an idea as others do.</p>
<p>CRDad, even if Aubrey took out a Stafford loan next year, the maximum available for a subsidized loan is $3500 and that would be distributed in two segments (for fall & spring tuition) -- so he'd be looking at waiting until sometime next fall to receive a $1750 disbursement to pay an $8000 loan. Since the parent is having difficulty making payment now, I don't see how they can wait a year in any case.</p>
<p>No doubt, the debt counseling is needed now, to reduce the interest rate first and bankruptcy may be a viable option. No point in Aubrey paying off his mother's debt if it's going to be discharged in bankruptcy anyway.</p>
<p>Mechanically, however, an $8000 debt at 18% becomes $9440 after a year. </p>
<p>He could get $3500 subsidized and $3500 unsubsidized at a 6.8% interest rate. That is a much lower interest rate than the credit card and could go a long way to bringing the debt down to fighting weight. </p>
<p>I'm not advocating it, but I don't know the whole situation, and Aubrey seems capable of putting the pieces together once he has the facts.</p>
<p>Hmm...
So far, all i hear is about you taking out loan after loan after loan. What makes you think that after you've taken out a loan to pay for your mom's loan, she won't go into debt again?
If you are able to pay the interest rate but just keep on spending more and more, i suggest instead of figuring out a way on how to pay back all the money at one time, just change your spending habits. From what I hear, your mom doesn't seem to have such a strict money spending habit even though she is in debt. If you borrowed money to cover her debt there's no assurance she won't be in debt anymore.
I'm not a banker YET but after i graduate from college I'll give you actual statistics :P
But I think this is more of a spending PROBLEM than a DEBT problem</p>
<p>"just change your spending habits...."</p>
<p>Come on Lynn4eva, maybe Aubrey's disabled mom should just eat cake! </p>
<p>Aubrey (who from reading earlier posts I learned was female) didn't ask for judgments. We don't know the whole situation. Perhaps the debt was incurred to pay medical expenses associated with her becoming disabled. For $8000 at 18%, the debt service is $120/mo. Perhaps if the interest rate were reduced her mom could make ends meet. Not everybody who gets into debt is irresponsible. Individuals are not statistics. Either way, it's none of our business.</p>
<p>I actually admire Aubrey for getting creative about improving her and her mom's situation. Sometimes in life, calculated risks are worth taking. Getting smart and arming herself with facts, she can do the math herself and assess the pros and cons.</p>
<p>Calmom: Thanks, I will look carefully into the link you posted.</p>
<p>CRdad: This is what I had in mind. My mom said that she will have most of the money to pay off her debt in 2009--but that is too far from now. All I am looking for is a loan that charges low interest rate or no rate at all until I graduate.
The interest rate is what is kills us, she has around 2000 debts in four of her credit cards, which equals to more than 8000 plus the interest. It's like we're throwing money away each month...where she pays off $100 but it's really $40... </p>
<p>So about this subsidized loan and stuff...I think that would be somewhat of a good idea. But I won't be in college until the fall of 2008.</p>
<p>And I'm really glad to have kind strangers like you guys</p>
<p>lynn4eva: We are spending as little as we could. My mom hasn't bought one new cloth in 2 years. All the debts that are on her credit card is due to dental problems. Florida Medicaid doesn't cover ANY thing that is surgery-related and they seem to think everything is cosmetic. But yes, I understand where you are coming from about people spending carelessly and realizing it's too late. Sadly, my mom is not one of them and yet we are still in trouble.</p>
<p>Aubrey - do try and have your mom go through debt counselling as a previous poster suggested. Make sure it is one of the non-profit ones rather than a business. From what I have read they can get the debts consolidated and most importantly get the interest rates reduced which would help out a lot. She needs to do this now rather than wait till you are in college - another years interest at the awful rate credit cards charge is going to make matters worse.</p>
<p>As far as subsidised loans for college are concerned - you can get only them if you have financial need as calculated by FAFSA. As a previous poster said if your financial aid package includes Work Study you can ask for it to be converted into a subsidised loan (my daughter did that with part of her WS this year) as long as you have not already maxed out the subsidised loans allowed for a freshman ($3500 Stafford and $4000 Perkins) Finaid has good information about loans here FinAid</a> | Loans | Student Loans </p>
<p>You mentioned you may possible have a full ride. If you have a full ride that does not include loans or WS then and there is no 'need' and you will not be able to get a federal subsidised loan. But it is possible your Mom can apply for a plus loan and if she is turned down (which seems possible considering her financial situation) then you can apply for additional stafford loans though they would not be subsidised if there is not 'need'.</p>
<p>Good luck with all this. But make trying to get your Mom get into debt counselling NOW your priority. If it is possible that would be much better than incurring debt yourself to pay hers off.</p>