Another cautionary debt story

JustAMomOf4
Thu, 23 Oct 2008 08:33:30 +0000

It just sickens me that F/A packages from college include so much in student loans.

Don’t go blaming the college here. No one has to accept student loans. F/A packages include Stafford (or Direct) or Perkins loans all of which are guaranteed by the federal governement. Subsidized means the feds pay the interest for you. This is “financial aid”.
Private loans are a whole 'nother story - any student can apply regardless of financial need.
I suspect this student had the max Federal loans but some private loans as well. I doubt he borrowed $150,000. He has probably been in default for sometime and the fees that accumulate grow exponentially. Couple that with unsubsidized Stafford and/or Private loans where the interest in capitalized and one can start out owing significantly more that what they borrowed.

I agree with the others that he is terrible at managing money - at some point one has to cut their losses. There are plenty of folks who transfer and/or quit for a while when school is just too expensive. The kids he graduated from high school with who went to work at McDonalds are far better off than he.