federal student loans vs. private student loans
i need to take student loans and im debating which one i should take. i know some people on here must have had experience with each/know about them. which one do you think should be better?
federal student loan interest rate is also about 6.8 percent...
6.8 percent? Holy shit, I have a credit card with only 6.99, frack... My student loans are consolidated at 1.25 percent. 6.8 seems like some bullshit...
When Obama took office, you were only paying $1.95 per gallon of gas...
i know it's a lot. if i get it through a bank, i would have a lower interest rate but the bank is also much more strict with their rules than colleges are. i just wanted to see what input anybody had on here.
Federal loans are interest deferred. Only a fool would pass that up.
"I have not been outdone by any of my friends in doing good, or by any of my enemies in doing harm."
-Lucius Cornelius Sulla
You're also going to have to consider that there are no longer subsidized student loans. Which means you're going to start accumulating interest once you receive the money. I did hear that they're thinking about reinstating unsubsidized student loans, although I'm not sure if that will actually happen
University of Florida '12
whhaaatt, this can't be rightOriginally Posted by ankskim
Made you look
http://www.finaid.org/loans/scripts/interest.cgi
starting July 1st.....6.8 percent...
Seems like two contradicting statements, could someone clarify this for me?
the hobo goes rawr
im just confused as shit.
I only had federal loans but my wife had both federal and private and both were deferred until 6 months after you stop taking a full credit load. Not sure if that's true with all private loans though. I believe federal looks slightly better on your credit report also.
not true, this depends on the state and college.
Made you look
I have clients that work in the Fed office which handles student loans. If you take out federal loans know this: They WILL get their money back. As with any loan, you should obviously take it out with the intention of paying it back. The Feds have been extremely lax on student loan debts until ~10-15 years ago, and since then the attitude has completely changed. The Feds have numerous private law firms who are contracted to track down student loans. Private law offices know wtf they are doing, and you do not want to get into that situation. They are fair but they will get their money. Pay back your federal loans or pay the price... the price being your credit and everything you own.
Not that any of this should make much of a difference anyway. Private or Federal, doesn't matter, don't take out loans you can't pay back. Obviously there is a risk involved but tread carefully. And like Dzan said... interest deferred is a pretty good deal.
i need about 4.5k to 5k in loans to cover all tuition and dorm and all that shit. i was gunna take some extra loan like maybe 2 or 3k for other miscellaneous bullshit. i wasn't gunna actually use it. but just in case. now many of you are in college....how much do you roughly spend annually? i dont even drink so all the bar runs would be out of the picture. is about 7 to 8k loans decent?
that isn't bad, and it's a hell of a lot less than if you were to go to a top private school.
I think the average is like $20k
I would aspire to be me if I wasn't already
yeah i know it isn't bad at all. but when medical school kicks in(hopefully). then im fuucked.
considering the amount of money you would(hopefully) be making, $150k in med school debt is still manageable
I would aspire to be me if I wasn't already
but lets say for some reason i don't make it to med school....i am so fuucking fuucked. like immensely. but i still am debating between federal or private loans.
do you mean not making it as in not completing it, or not going? Not completing it is one thing, but not going there isn't anywhere close to as bad.
would your parents help out? my loan is through my moms credit union and I'm only @ 3 percent
I would aspire to be me if I wasn't already
well either one really. my parents said they would help me out but i really dont wanna fall back on them. the plan is for me to take as much loans as possible, become a doctor, and when i officially sign a contract with a hospital, they wipe away school debt. up to like 200k. but i think i may get a private loan cuz my dad has got bitchin credit so i probably will get a low interest rate. i really need to figure this shit out. i move into college like Aug 22nd.
50K here. Gonna suck when I graduate
with what degree shin-n?
and how much do you spend off to the side annually? just need a rough estimate.
the second question is for anybody lol
My brother is in med school, he just takes whatever loans the school lines him up wit when he graduates hell have about 230k in loans, but then he'll be a doctor and be making more than enough to pay them off. He was originally gonna go through the navy, but after talking to other doctors he realized the above situation was not bad at all. If you do not make it to med school I assume you'll still have some sort of biology degree and I have a friend who just graduated ucla and got a consulting job and makes 90k with his bs, so he'll have no problem paying off his undergrad loans.
disregard females, acquire currency
Student loans are managed by the federal government. The only difference state and college will make depends on your cost of attendance at the school and cost of life in the state.
OP: I apologize about the statement about elimination of subsidized student loans. I was thinking along the lines of grad school since that is what I have been doing research for. Subsidized loans no longer exist for graduate and professional degrees (see http://studentaid.ed.gov/PORTALSWebA...tChangesSA.jsp). The reasoning behind this is that with a subsidized loan, your interest/payments are deferred until 6 months after graduation. So during the time you're in school, the federal government is essentially biting the bullet on cost of inflation. Basically, the 60k they lend you won't have the same purchasing power (value for buying physical goods) when they get it back. The average inflation rate over the past 5 years is about 2.5%. So if you borrow 15k each year through 4 years, the government is assuming $4,000 in losses. Considering they give out millions of these loans a year, I'm sure you can see how it adds up.
The good news is that they are still available to undergraduates. The catch here is that you must demonstrate financial need (see http://www.finaid.org/loans/studentloan.phtml). From the link:
The government sets an amount that they "expect" your parents to contribute towards your education based on their prior year's tax return. They don't care whether your parents are going to give you this much or not, but that sets the bar for your loan approval. You will always have the option of ubsubsidized (deferred payments), but this means that you will be accruing interest from the moment the loan is disbursed. If your family AGI is on the lower end, look into the Pell Grant as well. It is a scholarship funded by the government for lower income households. Free money is never a bad thing.To receive a subsidized Stafford Loan, you must be able to demonstrate financial need. About 2/3 of subsidized Stafford loans are awarded to students with family AGI of under $50,000, 1/4 to students with family AGI of $50,000 to $100,000, and a little less than 10% to students with family AGI over $100,000.
On the topic of private vs. federal, there is a definite advantage but you're rolling the dice in doing so. Ubsubsidized loans will be at a fixed rate. As you said above, you're going to be locked into that 6.8%. Private loans will seem more appealing at a lower interest rate, but they're often variable rates. The unfortunate thing about a variable interest rate is that it has nowhere to go but up. In the end you could be sitting on a 8-9% rate which is compounding off your accumulated interest. In the end, do your research.
University of Florida '12
Just saw your question about spending. My budget is 400/month. This includes going out (beer), essentials (toilet paper, toothbrushes etc.), gas, and things like that. Less frequent items are trips home (typically never under $200 between gas/food/spending), car insurance, moving costs, household items. My overall qualified expenses for 2011 were about $18,000.
Like mjs said, definitely look into credit unions. You're typically going to get a better loan from a credit union than a bank.
University of Florida '12
I'm gonna reiterate looking at credit unions. Many larger schools have credit union groups whose main purpose is to give student loans.
"This is for everybody in this city who's had homes that used to be wet," he said after receiving the NFC championship trophy. "This is for the city of New Orleans." -Sean Payton
I took out both a federal subsidized loan as well as a private loan through Chase. While the interest on my federal loan was high it was deferred for 6 months after graduation as Dzan & ZapBulletRider stated, while the rate on my Chase loan was fixed at under 3 percent, making payments on both loans simple and manageable. I don't know what your living/working situation is or what state your going to school in, but while working almost full-time and living off-campus, I qualified for and received around 7k in federal grant money through my FAFSA application, which was a significant help & cut my loans down to a little under 24k for 2 years at a UC. I personally would suggest both loan types as they have their own advantages and if you are living independently (not claimed by your parents) and employed, you will most likely qualify for a reasonable amount of free grant money. Good luck.
"Give a man a beer, he'll drink for the day. Teach a man to brew, he'll be drunk the rest of his life."
Thats what Ill owe after I finish my Masters. I went to a public University (UCI) for undergrad on grants and scholarships so only ended up with 3k in loans with my parents giving me rent money (they said they would pay for undergrad but since it was free they agreed to cover some of the living costs). I probably made 2 stupid decisions: going to a private school (Chapman) for grad school and choosing to do a MS (no grants except research) instead of a PhD. My field pays well so Im not worried about paying if off but kinda sucks that Ill have to live frugally even after I graduate because I need to start paying off loans and saving money for a down payment on property. Growing up sucks.
14 or 15k will end up costing me around 8k. Try to pay the interest while you're in school. It adds up quickly...
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