Private Student Loans (degree, school, score, pay)

[tangerinepuddle]

Anyone take one of these out to cover tuition not paid for by federal loans? What is your advice?

[XodoX]

How old are you?

[Kellem]

Originally Posted by tangerinepuddle

Anyone take one of these out to cover tuition not paid for by federal loans? What is your advice?

I have taken around 50K on private student loans, but I have not used them to cover tuition. I have a fellowship so my tuition, health insurance and living expenses are covered. I use them as working capital for some of the companies that I partially own. As far as I have looked, at 8% interest rates, these are one of the cheapest and most hassle free ways of borrowing money.

The are generally deferred until after 6 months after you graduate, but they are not subsidized and they do accrue interest while you are in school.

In my opinion, unless you are using this money to make more money, these loans should be one of your last options when looking for sources to fund your education. Right before using personal loans and credit cards.

Do you have any specific questions about them?

[sike0000]

Originally Posted by tangerinepuddle

Anyone take one of these out to cover tuition not paid for by federal loans? What is your advice?

I had to take out about 7k for my last degree. The downsides that you need to weigh are, 1. The interest rate you get (Watch your credit score). 2. what it may do to your consolidation after you graduate.

I wanted to consolidate all my loans, but if I had consolidated the private loans with my federal, it would have raised the interest rate for all my loans. So I chose to keep my private loans seperate and not consolidate those, just the federal. That way I got ~2.8% on my federal. My private loans are higher (I think 8 or 9%).

With everything together the interest rate jumped to around 5% for everything and I had to . And I have about 50k in federal loans.

I needed the money regardless so they only real decision I could make was the consolidation.

Oh, I remember that they charge a small fee (50 bucks or so) if I wanted to put them into forebearance. And! charge to consolidate them.

[NewHorizonz]

Like an earlier poster said, private loans should be your last option. I wouldn't recommend getting them unless you absolutely have to. I have private loan debt and am trying to pay them off ASAP. They are variable interest rates and fluctuate a lot. You'll usually pay double+ what you originally used them for. I hate private loans.