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Need to take loans out, don’t even know how to start. Help!

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Replies to: Need to take loans out, don’t even know how to start. Help!

  • cluelessandtiredcluelessandtired Registered User Posts: 51 Junior Member
    @blossom Thank you!!!! This was the kind of advice I was hoping for - things that we might not have thought of! :-)
  • SybyllaSybylla Registered User Posts: 2,335 Senior Member
    edited May 14
    I think for me, if you have to ask this question here (vs say, bogleheads), in May, then it isn't anywhere near straightforward. Asking here (vs shuffling your finances) and now (so late, so very late in this game) means there is massive uncertainty. Just because people are right doesn't mean you have to agree though, for sure. As you have resources outside of your home equity and 401K, leverage that. PP loans are for those with no options AFAIKS. As for the degree, it is highly relevant, no need to be defensive. It is what it is. Sell that condo now.
  • cluelessandtiredcluelessandtired Registered User Posts: 51 Junior Member
    Honestly, @Sybylla I was just looking for things we hadn’t thought of in addition to what we have going and I phrased it wrong because it was 5:30 in the morning (so mea culpa there.) But “right” for one isn’t “right” for all.
  • intparentintparent Registered User Posts: 33,743 Senior Member
    If you have a condo as you suggested, take a HELOC.
  • twoinanddonetwoinanddone Registered User Posts: 18,177 Senior Member
    You asked
    she will need approximately $30K a year in loans. FAFSA gives her $5,500, so we need to find the best option for the balance. If you’ve been this route and have a direction to point me in, I’d appreciate the help. Thanks.

    but when people suggested a HELOC or borrowing from a 401k you said you wouldn't do that. How were we to know that? You didn't say which school it is for, don't want anyone looking at prior post, so we don't have all the information needed to direct you to other borrowing sources. For example, the school may offer loans; Princeton, UVM, and others do. The state may offer loans. New Jersey does. Seems like you have only 2 options then:

    1.PLUS loans which you apply for through the school. They have a 7% rate and a 4.3% origination fee. There are some benefit that private loans might not have like forgiveness of debt if the student or parent dies, ability to consolidate loans from multiple years into one payment, easy to qualify for in future years.

    2.Private banks or credit unions. They set their own terms based on your credit score and situation. The rates are going up because the fed has raised the prime rates. Usually no death benefit if either the parent or student dies. May have a lower interest rate or no origination fees. Unsecured loans are expensive and might be limited by federal or state law. A $25k unsecured law is a high amount.
  • mom2collegekidsmom2collegekids Forum Champion Financial Aid, Forum Champion Alabama Posts: 83,648 Forum Champion
    Are these 100k+ loans for the parents to pay back? Or are they loans for a musical theater major to pay back?

    I know Folks who use Wells Fargo and Discover for college loans.

    Be sure to take out insurance on you and your child to cover the Loans in case one of you were to die.

    If your child were to die you’d have the additional pain of paying back a huge loan for a deceased child.

    If you were to die and this is a cosigned Loan, the lender usually demand that the debt be paid in full immediately since the cosigner is no longer living.
  • intparentintparent Registered User Posts: 33,743 Senior Member
    And if something happens to your kid (disability, death), private loans are usually not discharged. You still have to pay them back.
  • CollegefrazzledCollegefrazzled Registered User Posts: 83 Junior Member
  • lyndonwslyndonws Registered User Posts: 15 Junior Member
    Private student loan lenders are kinda like mortgage loan servicers. Can you guarantee any of them are better or worse? Will they continue to be so in the future? Is one person's experience with a lender representative of all experiences? Will regulation of the private loan industry change? You ask the unanswerable ...
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