Defer or not?

[Irish Eyes]

You probably had trouble financing the car because you had no credit history. Now that you are paying the loans that's changing. I remember getting my first credit car app in the mail as soon as I made my first student loan payment. You might be able to refinance the auto loan after making the loan payments for a while.

[bustaduke]

Originally Posted by ferrarisnowday

I have 3 categories of student loans. Stafford, Perkins, and one from Sallie Mae. The Stafford ones are 17,000 @ 6.5% I believe, Perkins are 7,500 @ 3.5%, and Sallie Mae is 7,000 @ 10.5%. Roughly.

I also have a car loan with a current balance of 8,500 @ 13.25% (YIKES!).

I can afford to make minimum payments on all of these, but not much more. I do not have much in savings and am trying to build up an emergency fund as well. My question is, how much does it hurt your credit to defer student loans? I was thinking of deferring / forbearing on the Perkins and/or Stafford loans to pay off the Sallie Mae and car one faster. Mostly the Sallie Mae, as after a year on the car I am going to try to refinance it. My loans are just coming out of their grace period now and I have no other debt aside from living expenses.

So is it a good idea to not be paying anything towards the Stafford and Perkins loans even while they accrue interest at a lower rate? Or will it hurt my credit badly, or not make much difference versus just paying the minimum on all of them?

My daughter was almost killed by a drunk driver last year and was out of work for about a year.

I called and they deferred her payments until she was able to get back on her feet and it didn't hurt her credit at all. You never know what they can do for you if you don't ask.

Wish I could say the same about the hospital bill. It was over $200k and they expected her to pay it back within six months.

I tried to get them to setup a payment plan or even reduce what she owed but they would not help her.

Funny this is, they told me if she had kids or was expecting they would write off the complete bill.

So I what told them was, what you are telling me is if she were irresponsible and got knocked up then you would pay her bills off but because she put herself through school and held two jobs she doesn't qualify for help.

Freaking idiots.



busta

[ferrarisnowday]

Originally Posted by Irish Eyes

You probably had trouble financing the car because you had no credit history. Now that you are paying the loans that's changing. I remember getting my first credit car app in the mail as soon as I made my first student loan payment. You might be able to refinance the auto loan after making the loan payments for a while.

Jeez, I remember getting them in high school!!

[drjones96]

^No kidding.

[skaternum]

Originally Posted by ferrarisnowday

Jeez, I remember getting them in high school!!

Me too. People act like pushing CCs on college kids is some new phenomenon. I got my first credit card when I was in high school in 1982. No co-signer. Just me.

[akck]

First off, I don't know if you qualify for a deferment. Financial hardship would be to only likely category, but by your own admission, you are able to pay your bills and save some. Like someone else said, I'd save the deferment in case you end up needing to use it later (i.e., job loss).

It was suggested that you consolidate your federal loans and extend them out to reduce your payments. This is a viable option in that you can channel the $$ from your current payments to your other loans. Once they are paid off, you can then pay off the consolidated loan early. I suggest that you first pay off your car loan with the extra $$ and then your high interest student loan. At least you can deduct the student loan interest on your taxes.

Check on how consolidation will affect future deferments before you do anything.