Private Student Loans - requesting recommendations

[carvers4math]

If you have to do loans, go federal if at all possible. And yes, FAFSA required.

[IcSyU]

Forewarning: The FAFSA is a complete and total PITA. I hated that damn form.

A couple things to people graduating and looking to consolidate:
1. Wait until you're partially through the grace period before you consolidate. Consolidating right away will start payments right away where most student loans have a 6 month window for grace.
2. If you can help it, keep federal and private loans separate. I don't think private loans can be consolidated into a federal consolidation program so you'd have to consolidate privately. Private lenders are a LOT less forgiving than Uncle Sam. If you have both, consolidate the private ones privately and the federal ones federally. If times are tough, pay the private payment before the federal payment.

[isukendall]

Did her parents not save any money for her college?? Absolutely do not let her take out any student loans. That would just be setting herself up for financial failure.

I can't stand the assumption that it's the parents' responsibility to pay for college. For the most part, I paid for my own college through scholarships and student loans, and out of state tuition on top of that. It was my decision to go out of state. Yes, I have a good stack of loans still (especially after five years of grad school as well). But I at least got a degree in an industry where I can afford my loans.

The way I read your statement is: parents not saving money = necessitated student loans = financial failure. IMO financial failure is if you go to a four-year school to get a degree in an industry that pays little money and/or has no jobs. At 18, you're an adult, and while you still may require guidance, you should still be responsible for your decisions, especially financial ones. Instead of making this clear as kids get out of high school, we just assume that parents are going to foot the bill, which leaves significantly less responsibility on the shoulders of the student.

[ISUME]

I can't stand the assumption that it's the parents' responsibility to pay for college. For the most part, I paid for my own college through scholarships and student loans, and out of state tuition on top of that. It was my decision to go out of state. Yes, I have a good stack of loans still (especially after five years of grad school as well). But I at least got a degree in an industry where I can afford my loans.

The way I read your statement is: parents not saving money = necessitated student loans = financial failure. IMO financial failure is if you go to a four-year school to get a degree in an industry that pays little money and/or has no jobs. At 18, you're an adult, and while you still may require guidance, you should still be responsible for your decisions, especially financial ones. Instead of making this clear as kids get out of high school, we just assume that parents are going to foot the bill, which leaves significantly less responsibility on the shoulders of the student.

I agree with everything you are saying, but just wanted to point out the growth rate of tuition versus the growth rate of wages is the real problem. Wages around the USA have been stagnant for years while tuition is going through the roof.

[carvers4math]

Our family views paying for a college as a joint responsibility between parents and students, but I really don't have a problem with parents who want to pay the whole thing or those who think it is up to the student. My kids are in STEM fields so I am hoping the investment pays off for when I'm old and drooling somewhere, which will probably be any day now.

[isukendall]

I agree with everything you are saying, but just wanted to point out the growth rate of tuition versus the growth rate of wages is the real problem. Wages around the USA have been stagnant for years while tuition is going through the roof.

This is definitely part of it. But if the real problems are (1) higher tuition and (2) low wages, then you either need to go somewhere with less tuition so you have little need for loans, or get a degree and good grades that will leave you capable of paying for the higher tuition. Just sending your kid to college anyway and footing the bill is irresponsible IMO. I know a ton of people who went to college on mom and dad's dime to get psychology degrees for example (some out of state as well), and few of them had jobs during school, a lot of them flunked out, because they had no sense of responsibility. The ones who did graduate have struggled financially because there are no jobs, and the ones that are available are low paying. Make a kid be responsible for their own decisions, and if you do a good job coaching them through it, they should understand the risk/reward of higher education.

[Vicarious]

I would recommend spending some time lurking around the Financial aid and Scholarship forum over at College
Confidential. Some of the posters have put several kids thru school and there's a surprising amount of info and advice there and if nothing else it is a good source for helping to fill out FAFSA.

I applaud your niece's decision to cut costs by attending CC first - too many place an unfair stigma on such a financially prudent choice. I would also encourage her to look into Presidential Scholarships if she is a good student and has solid ACT scores. ISU does not offer much but UNI is very generous with theirs and some out of state schools will give you almost a full ride.

[ISUME]

This is definitely part of it. But if the real problems are (1) higher tuition and (2) low wages, then you either need to go somewhere with less tuition so you have little need for loans, or get a degree and good grades that will leave you capable of paying for the higher tuition. Just sending your kid to college anyway and footing the bill is irresponsible IMO. I know a ton of people who went to college on mom and dad's dime to get psychology degrees for example (some out of state as well), and few of them had jobs during school, a lot of them flunked out, because they had no sense of responsibility. The ones who did graduate have struggled financially because there are no jobs, and the ones that are available are low paying. Make a kid be responsible for their own decisions, and if you do a good job coaching them through it, they should understand the risk/reward of higher education.

Once again I agree with your post. Maybe I should have stated when comparing situations you have to use the same time frame. If you told someone who graduated in the early 90's that you just graduated and accumulated 40k in loans and your starting salary was only going to be 10 to 15% more then their starting salary they would be shocked.

[JY07]

Another important detail about private loans: They will require a co-signer. Federal loans do not.

is this new? when i graduated 5 years ago, none of my private loans were cosigned

Also, i'm not sure where all of the iowa student loan hate is coming from. I had loans from them for all 4 years (variable), and once i graduated and the markets exploded in 2007, they let me switch how the rates were calculated without any issue (which was great, since they would have been near 11%).. from that point until i paid them off a year or two ago they were around 3%

[ISUCyclones2015]

is this new? when i graduated 5 years ago, none of my private loans were cosigned

Also, i'm not sure where all of the iowa student loan hate is coming from. I had loans from them for all 4 years (variable), and once i graduated and the markets exploded in 2007, they let me switch how the rates were calculated without any issue (which was great, since they would have been near 11%).. from that point until i paid them off a year or two ago they were around 3%

Mine didn't require a cosigner but doing so saved me 7% on interest both times.