College Loan Help Needed

[Donald Duck]

My daughter is starting her 2nd year of a 4 year university in NY.

We applied for finicial aid again this year just like last year thru FASA.gov and only were offered stratford loans (subsidized and unsubsidized). The amount offered is only about 1/3 of the total cost for this year.

Does anyone know of any other fixed rate student loans that are available ?

I'm looking for a low-interest loan that can be paid 6 months after she graduates.

Thank you.

:mickey:

[BrerGnat]

Are you looking at Parent loans too? PLUS loans, they are called. Or, do you want your daughter to have them all in her name?

Try Sallie Mae. It's a private loan company. Interest rates are higher though.

Does your daughter have a job? Maybe time to get one. I worked almost full time my last three years of college to help keep loans to a minimum and help pay for school and miscellaneous expenses.

[crazypoohbear]

Call the school's financial aid office. They should be able to give you a few names of good places. I don't know about NY but here in ma, there is MEFA and in RI there is RISLA. both offer a fixed rate loan 8.39%, deferred til 6 months after graduation. but you have to either live or attend schools in those states.
Good luck, It will work out.

[Donald Duck]

Are you looking at Parent loans too? PLUS loans, they are called. Or, do you want your daughter to have them all in her name?

Try Sallie Mae. It's a private loan company. Interest rates are higher though.

Does your daughter have a job? Maybe time to get one. I worked almost full time my last three years of college to help keep loans to a minimum and help pay for school and miscellaneous expenses.

Thanks BrerGnat.

It doesn't matter whose names the loans are in, as long as we don't have to start paying until 6 months after she graduates.

I was looking into PLUS loans and Sallie Mae last night.
Sallie Mae wasn't good because it's a variable rate with no limit.
PLUS loans might be good.

She has a job for the summer but she's going to be living on campus not at home.
It's kind of far to work there from college.
She might have to look for another job close to college.
I really didn't want her to work this semester because she didn't do that great last semester and I wanted her to have more time studying.

[Donald Duck]

Call the school's financial aid office. They should be able to give you a few names of good places. I don't know about NY but here in ma, there is MEFA and in RI there is RISLA. both offer a fixed rate loan 8.39%, deferred til 6 months after graduation. but you have to either live or attend schools in those states.
Good luck, It will work out.

I was planning on calling today.
Thanks crazypoohbear.

[RockinRobin]

Has your daughter looked for a job on campus? My daughter is a director of housing at a university and is always hiring. They are very good jobs and work around classes some times they pay for room and board and a small hourly pay. She should check this out and great perks

[Donald Duck]

Has your daughter looked for a job on campus? My daughter is a director of housing at a university and is always hiring. They are very good jobs and work around classes some times they pay for room and board and a small hourly pay. She should check this out and great perks

She doesn't start this semester for 3 weeks but I will tell her to look into that when she goes back.

Thank you.

[dnickels]

I filled the gap when I was in grad school with a combination of private loans (Sallie Mae was the servicer but for the life of me I can't remember the loan originator) and part time work. I'd get in touch with the Financial Aid office, they should have people who do this stuff as their job.

And I know everyone has their different views on it, but I'm pretty sure Suze Orman says to never ever ever co-sign or take out student loans in your (the parent's) name. They have student loans for education, they have no adult loans for retirement. If you've got the means to pay it back right away after graduation, I suppose that's one thing, but just be careful about what you sign. There are a lot of parents out there who try to help and do the right thing but are now responsible for 100k in loans with a young adult whose degree is never going to pay for itself. :twocents:

[Donald Duck]

I filled the gap when I was in grad school with a combination of private loans (Sallie Mae was the servicer but for the life of me I can't remember the loan originator) and part time work. I'd get in touch with the Financial Aid office, they should have people who do this stuff as their job.

And I know everyone has their different views on it, but I'm pretty sure Suze Orman says to never ever ever co-sign or take out student loans in your (the parent's) name. They have student loans for education, they have no adult loans for retirement. If you've got the means to pay it back right away after graduation, I suppose that's one thing, but just be careful about what you sign. There are a lot of parents out there who try to help and do the right thing but are now responsible for 100k in loans with a young adult whose degree is never going to pay for itself. :twocents:

Thanks dnickels.
I'm not talking about 100k in loans, more like 10 - 15k total.

[BrerGnat]

10-15K might not seem like a lot now. My parents didn't think so. They did it for 2 of us.

Then, they divorced and my mother got into some serious financial hardship. She had to claim bankruptcy. The loans (the portion in her name) were not forgiven. Student Loans are exempt from bankruptcy filing, just so you know. I'm sure at the time my parents took out these loans, they did not forsee a bankruptcy filing in their future.

I'd have your daughter get ALL the loans in her name only. It is her education, and if for whatever reason, she defaults on them later or cannot pay them (and you are a co-signer) it's your problem.

I exited college with $15K in loans. I was able to pay them off within 8 years of graduating.

Don't get too caught up in the interest rates right now. Since the amount needed to be borrowed is fairly low, it's not that much of an issue. My sister had to borrow $80K for art school...and when you have that much, a high interest rate is horrible...

[Donald Duck]

I just got off the phone with her school's financial aid office. She's not eligible for any more loans then the stratford loans she was approved for. My only options are a private loan or a PLUS loan.

Private loans (Sallie Mae) are variable rate loans with no cap.

The PLUS loans are fixed at 7.9%.

[Scott C]

Both of my sons go to one of the top engineering schools in the country. Tuition & Board exceed $50K -- I do not have that type of money. Fortunately they both received pretty decent scholarships and should only be 80-100k in debt upon graduation. Most of the students there have that paid in 5 yrs or so. BE SURE THAT THE DEGREE IS WORTH PAYING FOR. We use Wells Fargo for our private student loans

Thanks
Scott

[Donald Duck]

Both of my sons go to one of the top engineering schools in the country. Tuition & Board exceed $50K -- I do not have that type of money. Fortunately they both received pretty decent scholarships and should only be 80-100k in debt upon graduation. Most of the students there have that paid in 5 yrs or so. BE SURE THAT THE DEGREE IS WORTH PAYING FOR. We use Wells Fargo for our private student loans

Thanks
Scott

Thanks Scott
she goes to SUNY school so the tuition is no where near what it is for your sons

[MidnTPK]

Had it not been in this weekend's Wall Street Journal, I wouldn't be bringing this up....

Make sure if you co-sign any of the loans that you have appropriate life insurance for your student.



The Wall Street Journal
WEEKEND INVESTOR
AUGUST 7, 2010
When Student Loans Live On After Death

By MARY PILON

In July 2006, 25-year-old Christopher Bryski died.

His private student loans didn't. Mr. Bryski's family in Marlton, N.J., continues to make monthly payments on his loans—the result of a potentially costly loophole in the rules governing student lending.

As the college season nears, throngs of parents and students still are applying for private student loans, long used by students as an alternative to federal loans. But they may be unaware that in cases where the student dies, the co-signers often are obliged to pay off the balance of the loan themselves—a requirement typically not found in federal loans.

Many private student-loan lenders say they have a review process for cases involving disability or injury, and the new Bureau of Consumer Financial Protection will have an ombudsman in charge of private student loans. Yet neither the student-loan legislation passed in March as part of the health-care overhaul nor the financial-system overhaul passed in July requires lenders to discuss with the borrower and co-signer the consequences of a borrower's death or permanent disability, or require lenders to forgive private loans in those cases.

The Bryski case sparked the Christopher Bryski Student Loan Protection Act, sponsored by U.S. Rep. John Adler (D., N.J.) and introduced into the House of Representatives in May. The law, which has attracted co-sponsors from both parties, would require private student lenders—among the biggest are Sallie Mae, Citigroup Inc. and Wells Fargo & Co.—to explain to students the co-signer obligations in the event a borrower dies, as well as insurance options for loans and the circumstances under which loans can be discharged—though it wouldn't require lenders to forgive loans.

Sallie Mae, Citibank and Wells Fargo may require co-signers to continue paying private student loans after the primary borrower has died, though the lenders say they will look at cases individually. Wells Fargo doesn't offer medical forbearance, just a three-month period of hardship forbearance during which the interest compounds.

Sallie Mae—formerly a government-sponsored enterprise but fully private since 2004—recently introduced forgiveness in cases of death for its Smart Option Student Loan, but doesn't require it in its other private student loans. A Citi spokesman says, "We believe our policies are generally consistent with other industry participants."

Mr. Bryski, a three-sport athlete, took out $44,500 in private student loans and $5,000 in federal loans to attend Rutgers University in 2001. Joseph, his father, co-signed the loans for him. The family declined to name the lender that issued Mr. Bryski's private student loans because, his brother Ryan says, "we're not pointing fingers. It's not just our lender that does this."

While climbing a tree on June 17, 2004, the then-23-year-old Mr. Bryski fell five feet and sustained severe traumatic brain injuries. The accident placed him in a coma for four weeks, which turned into two years of being in a persistent vegetative state. At the time of the accident, Mr. Bryski was three years into his degree at Rutgers.

During those two years, Mr. Bryski's parents, Joseph and Diane, and his two brothers, Ryan and Joseph, say they juggled 12-hour shifts at the hospital and meetings with doctors with calls from creditors. From the hospital waiting room, Ms. Bryski says, she tried to call and settle her son's credit-card and student-loan payments.

"The bank said they wanted to speak with Christopher," Ms. Bryski says. "I told them, 'You can't speak to Christopher. He can't speak at all.' It's a horrible feeling."

Mr. Bryski had two credit cards with small balances that the family tried to have closed. Eventually, after the family had a lawyer write to the card companies, the balances were canceled. The card companies also refunded the amount the family paid on the account since Mr. Bryski entered the hospital.

Mr. Bryski's federal student loans were deferred as soon as the family submitted a note from a doctor detailing his permanent condition. They were forgiven completely upon receipt of Mr. Bryski's death certificate.

But when Ryan Bryski called regarding his brother's private student loans, a customer-service representative told him that the loans were eligible only for hardship forbearance, during which payments would be suspended for six months at a time and interest would compound on the balance at a variable rate.

The terms of Mr. Bryski's loan also stipulate that since the loan was transferred to the co-signer, Mr. Bryski's father, the entire payment could be requested at once. Consolidation options also were much more restricted.

"We're not saying we won't pay the loan," Ms. Bryski says, "But why didn't they tell us that years ago? It's not fair."

On July 16, 2006, two years after his fall, Christopher Bryski died. The family packed up his apartment, took in his dog, Maverick, and held a memorial service. The calls to customer service regarding the private student loans seemed to go nowhere. A legal representative of the private lender then wrote to the family to inquire about the intentions of Mr. Bryski's estate. "He didn't have an estate," Ryan Bryski says.

"I told them I just lost my son," Ms. Bryski says. "I'm aching in pain, and this is what they're going to do to me?"

The Bryskis continue to make the monthly payments on the private loans, which have risen to $518 from $366 because of interest rate changes and to make up for forbearance periods. The family will end up paying $85,800 by the time the repayment plan ends.

"We didn't want to think of the unthinkable. Then it happened," Ms. Bryski says. "We don't want any other families to go through what we went through."

Families looking to borrow for college should first maximize grants and federal borrowing options, which have recently had their limits expanded and generally offer far better repayment terms than private loans. Federal PLUS loans now allow parents to borrow up to the full cost of attendance, minus any other financial aid a student receives.

Those who do use private loans should read the fine print carefully to be clear about their legal obligations as co-signers in the event of death or disaster. Borrowers can sign up for auto debit so that payments can continue even if parents don't have power of attorney. Should trouble hit, families trying to have their private student loans forgiven should ask for a review.

[BrerGnat]

Suze Orman has mentioned a few times that Student Loans are FOREVER. That is, even in the unfortunate instance of death, they are not forgiven...

It's unfortunate, but true.

[Tiggerlovr9000]

Because we refuse to sign parent plus loans for our kids people think we are selfish. My kids are getting through college with scholarships, loans, their paychecks and help from us as we can. We pay their cell-phones, car insurance, health insurance and bought my son his first car for grad school this year because he cant live on campus. We also have my daughter who will be a senior at college that is only 5 blocks from our house.( since she finds it intolerable to live at home has taken student loans to live on campus.) We are not signing student loans so she can do that. I wonder what other colleges students would love the opportunity for free room and board while they go to college. My youngest is in high school and has not applied herself. We have payed for tutors and still are to up her ACT. She is very smart but just doesn't like school much. She says she wants to go to college though.. LOL
I know too many parents that are stuck with parent-plus loans and a child living at home with no degree.. I have great kids and I am sure they have every intention of getting degrees, but with retirement a short time a way we just cant take the risk. So if that makes us selfish then so be it..

[Donald Duck]

Because we refuse to sign parent plus loans for our kids people think we are selfish. My kids are getting through college with scholarships, loans, their paychecks and help from us as we can. We pay their cell-phones, car insurance, health insurance and bought my son his first car for grad school this year because he cant live on campus. We also have my daughter who will be a senior at college that is only 5 blocks from our house.( since she finds it intolerable to live at home has taken student loans to live on campus.) We are not signing student loans so she can do that. I wonder what other colleges students would love the opportunity for free room and board while they go to college. My youngest is in high school and has not applied herself. We have payed for tutors and still are to up her ACT. She is very smart but just doesn't like school much. She says she wants to go to college though.. LOL
I know too many parents that are stuck with parent-plus loans and a child living at home with no degree.. I have great kids and I am sure they have every intention of getting degrees, but with retirement a short time a way we just cant take the risk. So if that makes us selfish then so be it..

Thanks Tiggerlovr9000.

My daughter prefers to live on campus rather than home too, only she's not 5 blocks from campus. If she was I wouldn't pay for it either.

Her freshman year was at a different school. It was over an hour from our house. It was too far too commute and her car has a lot of miles on it. That school closed and now she's going to the same school I went to. It's a 45 minute drive from our house to her school. I commuted when I went because I didn't want to live on campus. It was far but I didn't mind. I really don't want her driving her car 45 minutes each way every day. Her car isn't going to last 3 years of that.

She is taking out the maximum in loans that she can. We pay for her cell-phone and health insurance too but not for her car insurance or gas. Her car is her responsibility.

I don't think we're going to take a PLUS loan out.