Quote:
Originally Posted by Orion99
Has anyone explored the options of sourcing a student loan in the name of the student, with no attachment to the parent (as co-signer)?
There are simply too many rabbit holes on the web, so if anyone has gotten some concrete experience, I'm all ears.
Ideally, the student will incur the loans each year (for tuition) with the option to repay upon graduation.
I do not want to be linked to the obligation. I did that for year 1 and now am on the hook for immediate repayment at the comparatively high gov't rate for parent co-signer, currently around 7%.
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Here's a couple of pointers:
- There's something called Federal STAFFORD Loans, ever heard of them? They are taken out in the student's name, the only thing the student needs from you is your financial information to enter into the FAFSA and they will obtain their own financial aid package with Pell Grants (if they qualify) and the Stafford Loan amounts based on their current year in school. If they are over 24 they no longer need your financials.
- Do not EVER co-sign a loan for anybody on anything, that is beyond stupid. Did you save up anything for your "child" from age 0 - 18 for college? If not, co-signing on loans now to try and "make up for that" won't work.
- Teach your "child" how to pick a college they can afford based on the limited amount of resources that they have including the Stafford Loans and working on the side while in college.