Are the unsub Stafford loans a good deal if the parents pay for them?
(The $5,500 freshman year, etc).
I’m trying to figure out if we should get the freshman loan. We could pay year one out of savings but need to convert assets for the following years, so I’m thinking maybe spread the savings over a bit by taking the loans.
Thoughts?
You are going to want to keep in mind that the unsubsidized loan is going to be accruing interest from the day the loan disburses. If you don’t need the money for the first year, but anticipate needing more above and beyond the yearly amount offered based on the student’s grade level for years 2-4, it isn’t the worst idea.
You can pay interest on the unsubsidized Stafford loans. If you start doing it right away it’s not too costly.
Yes, we can pay the interest monthly right?
Take the loan, if at all, at the end of the year. I don’t see the point of borrowing in year one if you can borrow enough in year two to pay for year two.
You can make interest payments once a month, or even more often if you would like as soon as the loan has been disbursed.
That’s a very good idea. The interest on these loans is daily so taking it as late as possible in the year is a good idea. The deadline for accepting a federal loan is usually in May or late April at the earliest but I think the schools set their own policies so it’s worth checking.
I think you can apply for the loan until June 30th for 2014 - 2015 school year. I would think that this month and day would be consistent for each year. Since our freshman year is paid, I’m guessing we would get a check or a check is sent to the school and applied for 2015-2016 tuition.
We are still debating taking a loan when we don’t need it right now, as well. Trying to stretch and plan when child #2 enters 2 years from now while child #1 will still be in college with the possibility of needed extra semester or two. I’ve been dwelling on this for months and months!
There can be some limitations when it comes to accepting loans during a given school year, and in some cases - loans cannot be accepted in June after the previous school year has passed. A good rule of thumb is to have the loan requested before the student starts taking finals, which typically is towards the end of April. It is best to confirm this with the school where the loan is being borrowed.