Friend thinks $100,000 college loan is reasonable - help? (CPA, cost, public school)

[sike0000]

I agree with some of the others. 100k is a bit extreme depending on the career, and especially for undergrad.

I believe federal loans max around 48k (not sure what the limit is nowadays) for an undergrad degree. For that 48k alone you will be looking at around 200-300 a month depending on consolidation/interest rate, and taking 20 years to pay off.

So that means the rest will have to be private loans. That could be 5% or even 10%, (maybe less but you should check). So thats another say 300 to 400 or higher a month on top of your already high payment, although they might require you to pay back in 10 years so that will really raise the payment. You could consolidate everything but that might raise your overall interest rate for the entire 100k.

Not saying you shouldn't, but having a six figure job at the end of your education would be desirable I would say lawyer or doctor but you haven't even started thinking about graduate degrees. I have around 70k in loans as an engineer (undergrad only), and although my payment is reasonable (to me at least), 100k would be pushing it a little. And depending on your field even engineering might be tough.

On the bright side, you could look at it like I do: I may have 8k worth of my salary per year paid towards loans, but I make 30k more per year than I would without my degree. Just think of it as an investment. What will you get out of it etc.

[Katarina Witt]

That's high for undergrad. It would probably preclude any type of grad school for which you need to take out loans (med school, physical therapy school, most arts PhD programs). She should talk to her high school guidancae counselor.

[akck]

Another option is to steer her towards private colleges. She may be able to get grants and scholarships that will make it cheaper than an out of state public university. At least, that was our experience, as OOS public university's aid would have been in the form of loans.

[jdm2008]

Originally Posted by eevee

I'm curious as to when jdm got his loan. it may have been easy for him to get such a loan back when he got it, but it's likely far more difficult to do so now due to the credit crunch. plus, this is someone w/ no credit you're talking about so she's unlikely to get great rates. honestly, I agree w/ everyone else that this is way too much money for an undergrad degree unless she's going into a relatively high paying field that doesn't require a graduate degree (even future docs shouldn't take out that much in loans for an undergrad degree, IMHO)

I got my loan from sallie mae. It is low now (prime rat- .5%), so it is 2.75 right now. I could be hurting in a couple years. Though I have some fixed rate credit cards with big limits under 10 percent, that I can transfer some too if I think interest rates will start to go way up, but that is a guessing game. I agree its hard to get that much money these days. I also will not attend grad school, unless a employer pays for or if I decide to join the military(which is a long shot).
Just to stress my point I think taking this much debt was a mistake and I would not do it again.

[lisdol]

I would urge her to think some more about NM state schools because I am pretty sure the lottery scholarship pays for a lot. It wasn't around when I went to school at UNM but I have friends who have high schoolers and they always mention the lottery scholarship as a big help in paying for college.

[TabulaRasa]

She should sell the car and bank that money toward part of her education, since that's what it was originally intended for.

I also agree that private colleges are often the way to go for grants and scholarships...I ended up owing less going private than I would have going public due to exactly this...I got three years' tuition, room, and board for free, when all was said and done. No public school I applied to could or would match that, it was all loans with them.

100K outta pocket is unnecessarily high for a four-year degree.

[XodoX]

Originally Posted by violent cello

Thanks for the replies everyone. As someone else said here, it's possible to get a loan without co-signing, which is what she's planning to do. And no, her parents are not intending to help her out - they have said they'll help out with costs if she stays in state only. As far as they're concerned, they bought her a car and that's their "help" for college :eyeroll: that $20K they "saved" for her is something they spent for themselves and then tried to make it look like the car was hers originally. As for scholarships: she's eligible for small ones, up to about $4,000 a year. Which isn't bad, but it's not great. Her grades suffered badly last year so the scholarships that are purely grade based are ones she won't get. That's also going to hinder her getting into a good school of course, but she has very exceptional circumstances that can explain the grade problem.

I like the idea of showing her what monthly payments would look like. She loves clothes so I think I'll show her how little she'll have for clothing once she's paying off this loan! I'm wearing shoes with holes in them for work these days thanks to not being able to justify new work shoes right now. Damn loan payments. Damn low-paying job I have.

I tried to get a student loan a few weeks ago. I have excellent credit and I did not get approved without Co-signer. The same happened to 3 of my friends. She wants 100k...I just applied for 10k...

[Wingfoot]

You need new friends.

[StarlaJane]

You would be better off buying a house with the money and looking at colleges that are state-run and/or do not have such high tuition for undergrad. If you are going to spend that kind of money, I would spend it on grad school.

[XodoX]

Originally Posted by Wingfoot

You need new friends.

uhhh , ok...me?