I was pretty shocked when applying for a college private student loan for my daughter that even with me as a co-signer, they wanted to charge 10%, with a 3% origination fee!! Does anyone have any idea if it could have been because my credit rating is only about 722, down from 745, or was it just because of my daughter being a college student with no job?
In any case, I'm trying to improve my credit rating by not having any charges with a balance near the limit. I'm thinking that this will be essential to get student loans at a decent rate. I guess I'll put in for my free credit report right now to get the story on why it recently decreased by 20 points (according to the Wamu website). I haven't really done anything recently that would have caused that that I know of.
Later addendum: I am happy to say that Discover came through with an excellent rate, about half of Chase's!!! It sure pays to shop around - too often I think "they're all the same" - definitely not true.
Why was the quoted loan rate so high for a college student?
January 10th, 2008 at 02:44 am
January 10th, 2008 at 02:48 am 1199933319
January 10th, 2008 at 03:04 am 1199934249
So what other options are there? She has the max Stafford of $3500.
Oh, to raise her credit rating, should she accept one of those CC offers she gets in the mail and use it a little? I hate to do that, but if that will get a lower rate it's certainly worth it.
January 10th, 2008 at 03:15 pm 1199978124
You both may be eligibile for government loans above that $3500 amount. There are subsidized and unsubsidized government loans for students and parents to help make up shortfalls, and the borrowing limits are higher. Here is a link to get you started:
http://www.ed.gov/offices/OSFAP/DirectLoan/about.html
Avoid private loans at all costs. They are absolutely terrible! Many of my friends have them and they are truly suffering as a result.
January 10th, 2008 at 03:19 pm 1199978389
http://www.salliemae.com/get_student_loan/find_student_loan/...
January 10th, 2008 at 11:42 pm 1200008539
"A Federal Perkins loan is a low interest (5%) loan for undergraduate and graduate students with exceptional financial need."
So it looks to me that the grand total of non-private loans available for a freshman is the grand total of the $3500 Stafford loan. Or in others words, a drop in the bucket.
Man, what an alphabet soup all this Federal stuff is! And with laws changing left and right, what a mess!
Yes, thriftorama, I can see how your friends would be groaning under the weight of all that debt, especially at 10%!! Man, this stinks.