Actually, first, I am simply playing devil’s advocate – stirring the pot. :-S
Second, what I suggest is that OP test his parents, one way or another, to see how serious they are about this loan issue. They don’t seem like the type who would be willing to have a “heart-to-heart” (which I agree is normally the best path). These parents likely have a ton of money, and know all about finances, but want to teach their children something.
I otherwise completely agree with @dodgermom – the student should not take the loan from the parents (even for OSU).
By that rationale, they should also be expecting you to repay them for 17 years of food YOU consumed, clothing YOU wore, a roof over YOUR head, etc. Most American parents whose financial position is such that they will not qualify for any financial aid will gladly contribute to college costs for their children to the best of their ability and without any expectation of being repaid. I’m sorry OP’s parents don’t feel the same.
That’s not math–that’s OCD. I’m not really kidding. You don’t study anything like that when you study math. But you can get plenty of math in business. You can get mathy enough to made financial models that are quite complex. There are all kids of models used in financial markets and other business too. There is an entire emerging field of data science to handle the large amounts of data being generated to gain insight for business decision makers in every type of business. Statistics are very important for managing and understanding Big Data. You might like stats quite a bit with you number OCD. Now I am teasing. :))
But you don’t have to read this website to understand that teenagers are quite ready to grasp the concept and consequences of debt. They also do not have money to pay for their college. So your parents are not logical at all. They are letting you down in every way by not offering guidance, support, encouragement and funds to go to college.
I suggest you take out your max student direct loans, it is worth it for Wharton. Then you borrow the rest interest free from these odd parents. Chances are they may pass away before you have to repay it all.
Um, @CINEJF, Wharton has always had an undergraduate program. There’s no change. Just because you worked with Wharton MBA’s doesn’t preclude the existence of Wharton undergrads.
If Penn is your dream school you may kick yourself for not attending. If your parents have the funds to borrow interest free then do it. You can be on a payment plan that is affordable to you, as they are your parents and interest free loan is a good thing, your parents giving you the loan a better thing. You can pay a low amount each month and with no interest you will be able to pay them back in due time. Penn, definitely.
I think the student needs to FIRST talk to the parents about what sort of payment plan are they expecting with a $240k loan…lol.
The parents may not have yet “done the math” or they may have unrealistic expectations. THEY may be thinking…“oh, after he graduates, he can live at home, work, and pay us back.”
BUT…no one knows where he’ll be employed. It may be in another state or just too far from home. OR, he may be in a committed relationship by then and NOT WANT to live at home. He may want to marry or live with his SO.
I have a feeling that no one has really thought this all thru…
Even at interest free, paying back $240k…
10 years at $2000 a month = $24,000
It is very unrealistic for a new grad to pay $2k per month. Also, I’m not sure that an undergrad degree from UPenn is enough. He’d need grad school, a masters degree…which will also likely be UNFUNDED.
So…is he supposed to borrow another $120k+ for grad school???
OP needs to talk to parents. Maybe the parents are thinking - this is a lot of money and how do we ensure he doesn’t waste it by partying at Penn instead of taking advantage of Wharton opportunities.
Figuring out an acceptable payment plan is the first step.
And, as noted above, the repayment obligation will not be enforceable unless they actually execute a written loan agreement. So the only thing really in jeopardy is the OP’s relationship with his parents. Whether or not this loan will become a problem between them is something only he can know.
And correct me if I’m wrong, but the OP doesn’t sound like a kid who’s going to party away four years at Wharton. I believe he, like all of us, realizes what an extraordinary opportunity he’s being offered.
i find this whole thread sort of baffling…and why is the OP bothering to give his stats & background? The time to find and apply to a college is long gone…now you’re faced with a small group of schools to attend and none of them with good aid (for your stats).
As far as the “loving math” and perhaps feeling that UPenn won’t be the ideal place for this…trust me, there are many appreciators of math at Wharton.
Posting stats and background allows the OP to collect information that could be useful if along with overpriced A, B, and C, taking a gap year is also under consideration. Someone with stats for Penn would have other options for free if the decision is made to take a gap year and apply elsewhere for fall 2016.
lol…thanks for catching my missing ZERO. Yes, I know it’s $240k!
Even at interest free, paying back $240k…
10 years at $2000 a month = $240,000
Paying $24k per year. It’s just not reasonable to expect that a newish grad can pay that much back. And I think grad school may be needed if going into some kind of Finance or similar.
I think the parents are thinking that the student can “live at home” and pay that back, but that’s not a reasonable expectation.
I also wonder what the parents are expecting as a timeline!
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as noted above, the repayment obligation will not be enforceable unless they actually execute a written loan agreement. So the only thing really in jeopardy is the OP’s relationship with his parents. Whether or not this loan will become a problem between them is something only he can know.
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This is my concern… I don’t think the student is going to party away the opportunity (altho that sometimes happens), I’m concerned that 4-6 years from now, the student could be getting married or need to live in some pricey area for work, and not have $24k per month to pay back parents (and that’s only if they agree to a 10 year loan repayment schedule…who knows!!! They may think he can live at home and pay them $50k per year!! lol )
@mom2collegekids - Please tell me you don’t do your own taxes. You now having him paying back $24,000/month!
In any event, I rather doubt the parents are expecting a Wharton business grad to live at home, but that’s something that the OP is going to have to sort out with his parents himself. If they can afford Penn without compromising their own lifestyle (or retirement savings), then I think he should accept their offer.
I thought I wrote $2k per month and $24k per year.
$2k per month for 12 months is $24k
$24k per year for 10 years is $240k
Did I screw up my correction in post 37? Oh, now I see in the para. lol I meant to write $24k per year.
My point is that the student needs to find out what the parents repayment schedule expectation is. Over a 10 year period at $2k per month? longer period? shorter period? Do the parents expect him to live at home???
I agree that the parents and child could end up with a bad relationship if the student can’t make those payments and the parents start judging his life choices (Well, if he lived with us instead of an apt, then he could pay us more. Or…If he didnt’ get married… or if he didn’t have a child…)
