Student loans.

What kind? There's government subsidized and unsubsidized loans, and then there's loans from private sources (banks, credit unions, loan sharks, etc.). Subsidized is best because it doesn't accrue interest while you're a full or part-time student. Unsubsidized accrue interest from the date the money is disbursed. In both of these cases, interest rates are generally quite good. I have no experience with student loans from private sources. I also received the Perkins loan, but I think that's now defunct (it was federal money that colleges loaned to low-income students).

I have a pretty hefty student loan debt (approx. $70k), but even after I subtract my payments from my income I'm still making more than I would without the college education. Economically, it makes a lot more sense to take the loan and go to college rather than wait until you've saved enough money or take only a few credits of course work a year until you finish a degree.

I do, however, gain some satisfaction that I will probably die before it's paid off. :wink:

Mills
Could you direct me to government subsidized loans. My son applied for a student loan for my grandson and was given interest rate of over 8%. He claims that loan money Govt. has basically dried up. Needless to say the loan was canceled. A loan of $15,000 would end up in a payback of over $45,000.

To get the government loan you simply fill out a FAFSA. You can apply online
here. Unless they've changed the system (it's been five years since I've dealt with applying for financial aid), all you have to do is fill out the FAFSA and the colleges you apply to will send you a financial aid package based on it. The FAFSA covers all federal financial aid (grants and work-study as well as loans) and many colleges use it to determine students' eligibility for financial aid offered directly by the college.

Keep in mind that income is a consideration--federal student aid is designed to help low-income students; the more money the student and his or her parents make or have in the bank, the less aid they're likely to be approved for.

The 8% sounds a bit high, but the rate charged is always based on prime rate. Have rates gone up recently?

Yep. Both federal subsidized and unsubsidized are defferred payments. Subsidized loans are also deferred interest. I got a couple about two years ago and the rate was 3.5, but they vary. Your son should have his son do the applying and help out if necessary but the federal loans are much more reasonable than independent bank education loans.

Mills75

Since I was not involved in the search process for the loan I know very little other than it being based upon the prime rate. I am just trying to gather information I can pass on.
As to this years expenses. They have been taken care of sans loan.

If they can afford to continue covering the cost of college without loans, they should. However, if doing so will have a significant negative impact on your son's finances (say, delay his retirement), then there's a better solution.

This years need are no longer a problem We were able to cover them without a loan. The next three and the second son who will be entering college in two years that are of concern.

The rule may have changed since I was a full-time college student, but parental income is not a factor if the prospective student can demonstrate having lived on his or her own and supported him- or herself for six months while not attending college. Once this independence is established, however, the parents may longer claim the student as a dependent on their taxes.

So, delaying the student's enrollment for six months may be necessary to avoid delaying the parents' retirements for a few years. But make sure they fill out the FAFSA first; having multiple students in college at the same time usually means an increased probability of qualifying for financial aid.

i have a question about student loans too:
can you take out a student loan from a bank or something that is not based on financial need? and if yes, does anyone know of any of these companies/institutions that I can do that from?

thanks

yes only borrow subsized loans because they don't accruie interest until you're done with school