In addition to the Parent Plus, your local bank (maybe a line of credit on your home if you have equity), just know loans have fees and rates are incredibly high now. Loans are expensive.
I understand your predicament.
I hope you and your son will consider extra employment now to help mitigate the short and long term damage these loans will cause on both your financial health.
Best of luck.
I guess I don’t really get how a parent plus loan is any better than a student loan. The school advisor didn’t make one loan seem better than the other. I am aware a parent has to cosign the student loan.
We use Sallie Mae because rates are lower than the parent plus, loans are in our students’ names, and they offer co-sign release after 12 months of repayment. There are other private lenders as well.
Parent Plus loans don’t really require anything except you being able to breathe. Other loans require that you be qualified to receive a loan.
Another thing you need to check with ANY loan is when payment starts. For some private loans, payments start as soon as the loans are disbursed. So…will these payments be affordable for you if that is the case?
After this first year he can apply to be an RA for the remainder of his time. Most schools provide the room at no charge to RAs.
Talk about options such as this, continue to meet with the financial aid office, so that perhaps a loan is only needed for this first year.
I wish you and your son the best.
Just remember, these are very competitive jobs on most college campuses and there is no guarantee your son will get the job.
I suggest he start planning - per @thumper1 note. He will need to stand above the rest. I highlighted compensation below which seems good but put in their link below for how to become an RA. I’ve read many schools today only giving half of room expense so if he lands this gig, their listed compensation policy is much better.
Compensation:
There are some differences based on the size and complexity of residential communities and compensation provided. The standard base compensation for a Resident Assistant is a single room and board plan valued based on the residential community in which one is placed, plus a yearly stipend paid in bi-weekly installments.
Perhaps this will help you learn more about available loans. Note up front fees, not just interest rates. In general - they’re bad !! But if this is how you want to go….
Can you get his father to cosign the loan? Because at least your finances/credits will not be on the hook.
It’s really hard to launch in the arts with significant debt. I hope it goes ok for him. But it sounds like you’re in a tough position. I’m sorry.
If the dad gets these loans, can you count on him to do so all four years of college?
A parent plus loan is in the parent’s name. The student is not responsible in any way and the loan balance cannot be combined with the student’s own federal loans. You’ll have a payment on the Plus loan and he’ll have a payment on the (federal) student loans. Never the twain shall meet.
The private student loans (Sallie Mae, Discover, SoFi) can either be to the parent or to the student with a parent co-signer. The repayment terms, origination fees, interest rates are sent by the private lender. The plus loan terms are set by the federal govt. If you want a plus loan, it is done through the school’s FA office (probably info online).
I really do understand wanting to help your son get away and go to college. You are just paying a big price for it, and so may your other children. If you use your savings, you’ll have no emergency fund. If you have other children at home, it’s unlikely you’ll be able to work a second job as was suggested above. If you take out a Plus loan you can defer repayment while your son is in school but you cannot defer the interest, so that will build and build. If you can restart the payments immediately, that’s best but expensive. If you take out the Plus you, you and not him, will owe $12000 plus interest at the end of the first year. There is an origination fee, so you won’t actually get $12000 disbursed for the loan, so you may have to come up with a payment each semester to the school to cover the full bill.
As I suggested above, see if he can defer his start until Jan. He can work until then.
My kids had a rough high school experience as they had to go to 3 different schools (none with friends from middle school) because of moves. They really wanted to go to colleges in California and we just couldn’t afford it. I had to set the college budget at what I could afford. They were disappointed. They ended up liking their schools just fine. They would have LOVED a California school but that just wasn’t a financial option. They could have just moved to California if they had wanted to but they wanted college first.
IMO it is better to disappoint your son now, for perhaps 6 months or a year, then to have him go into debt and really restrict his career. If he is 18 now, he can refuse visitation with his father. He can travel on his own. He can get a job on a cruise ship and practice his film making or work in the theater or lighting groups. He can make money doing a vlog. And save money for next year.
This is all very disappointing right now, but it will also be disappointing next year when you can’t afford a second year loan and you’re still paying on the first year loan. And what will your other kids do when they need college tuition?
Has your son been awarded work-study as part of his financial aid package?
One thing I want to mention, because it came as a surprise to me, is that work study jobs are not guaranteed, even if there is a work-study award in the financial aid package. That was true for my kids’ two colleges, and I have heard it is true elsewhere.
In practice, what it means is that your son is authorized to apply for a work-study job. It is up to him to find one and work those hours. The money goes to him as he works the hours, not to the college. He (or his family) is responsible to pay that money as tuition/room and board up front, even if he doesn’t find a work-study position. Also, the work study money is not required to be spent on tuition, and in fact, for us, we had to pay the work-study amount before the jobs would even have started. The work-study money would simply be a means to “reimburse” the family for the tuition money in that amount.
And…as was mentioned above…a lot of the more desirable work-study jobs (such as library jobs or other desk jobs where you can study while you work) get taken early by students who are aware of how this works. So if he has been awarded work-study and if you and he intend that he actually work a work-study job (because otherwise you (or he) will have to pay those funds out of your savings or a loan) then it would be really good for him to line up that work-study job now. Here is a link to UW’s information on work-study jobs:
Federal Work-Study – Student Jobs – UW–Madison (wisc.edu)
Good points.
Adding that sometimes there are non-work study jobs, either on or off campus, that pay more than work study jobs. Obviously the off campus jobs would have to be accessible transportation wise, but jobs like babysitting/nannying or at fast food places pay good money.
Excellent point. I was also surprised to learn that a student can take a non-work-study job, even if offered the opportunity to have work-study.
The financial aid offices really don’t do a good job of explaining this, in my experience.
@Sarah899 this list that @tsbna44 provided is a good place to start!
I hav used college Avenue loans and they have a good help desk who can answer any of your questions. They have both a chat feature and they also take phone calls. They offer both student loans (co-signed) and parent plus loans.
It can take a few days for the funds to be sent to the college. You can probably call the bursars office and the financial aid office to tell them a loan is en route if you would otherwise miss their deadline, so as to hopefully avoid any late fees.
Good luck. I am hoping all goes well for you and your son
I don’t know how well this works at UW, but at my daughter’s university, many students take advantage of a dual enrollment program to save on tuition costs. They live at, are enrolled in, and taking classes at the university, but are allowed to simultaneously take some intro classes at the local community college (at a lower cost per credit). The university gives them credit for those community college courses that satisfy core requirements.
This website suggests UW also allows some concurrent community college classes. You might explore if this could offer some cost savings: Concurrent Enrollment – L&S Undergraduate Academic Deans’ Services – UW–Madison
Is your son at UW Madison or UW Milwaukee? (Saw both on the thread -exact location would yield more exact campus specific recommendations).
Milwaukee
kelsmom
I will try this. He is enrolled at University of Wisconsin Milwaukee. I have been contacting finances@uwm.edu but getting replies from that email is very hard and takes weeks.
Any college student can apply for non-work study jobs. But work study funds won’t pay for those.
Also, any money earned doing a college work study job is not considered as income for FAFSA purposes in subsequent years (@kelsmom is this still true with the changes)