FYI on student loan rates going forward

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Louis1127
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Re: FYI on student loan rates going forward

Postby Louis1127 » Thu Jul 25, 2013 9:10 pm

zman wrote:
Louis1127 wrote:Unfortunately interest rates will be going up right when I need student loans for LS. Errrrrggghhh.


it's not the interest rate that is the problem. It's the expensive tuition.


True true. Still would be less debt after graduation if the rates were lower tho :(

zman
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Re: FYI on student loan rates going forward

Postby zman » Thu Jul 25, 2013 9:12 pm

Louis1127 wrote:
zman wrote:
Louis1127 wrote:Unfortunately interest rates will be going up right when I need student loans for LS. Errrrrggghhh.


it's not the interest rate that is the problem. It's the expensive tuition.


True true. Still would be less debt after graduation if the rates were lower tho :(


Not true.

If rates were lower, tution would be higher. If elizabeth warren had her way, tuition would RISE at a far more rapid pace than they already are.

dstars823
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Re: FYI on student loan rates going forward

Postby dstars823 » Thu Jul 25, 2013 9:13 pm

Louis1127 wrote:
zman wrote:
Louis1127 wrote:Unfortunately interest rates will be going up right when I need student loans for LS. Errrrrggghhh.


it's not the interest rate that is the problem. It's the expensive tuition.


True true. Still would be less debt after graduation if the rates were lower tho :(


Hopefully congress knowing 2014 is an election year will decide to take up this issue again next year to try and gain votes. This hopefully is a stop gap measure and not something that will be permanent. 10% interest on loans means you might as well just get private loans.

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Louis1127
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Re: FYI on student loan rates going forward

Postby Louis1127 » Thu Jul 25, 2013 9:16 pm

dstars823 wrote:
Louis1127 wrote:
zman wrote:
Louis1127 wrote:Unfortunately interest rates will be going up right when I need student loans for LS. Errrrrggghhh.


it's not the interest rate that is the problem. It's the expensive tuition.


True true. Still would be less debt after graduation if the rates were lower tho :(


Hopefully congress knowing 2014 is an election year will decide to take up this issue again next year to try and gain votes. This hopefully is a stop gap measure and not something that will be permanent. 10% interest on loans means you might as well just get private loans.


Unfortunately I don't think that enough seats in the House will be competitive for it to force the rates to keep from rising to such a high level. I like your thinking tho.

dstars823
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Re: FYI on student loan rates going forward

Postby dstars823 » Thu Jul 25, 2013 9:17 pm

Louis1127 wrote:
Unfortunately I don't think that enough seats in the House will be competitive for it to force the rates to keep them from rising to such a high level. I like your thinking tho.


Im just praying that congress somehow decides to act like rational players.... maybe im just being too much of an optimist.

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guano
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Re: FYI on student loan rates going forward

Postby guano » Thu Jul 25, 2013 9:27 pm

zman wrote:
dstars823 wrote:just hope for a super slow recovery so that bernanke has to keep the rates low and the money cheap


the economy will NOT recover as long as money is cheap and rates are low.
???


Paul Campos wrote:My guess is that people enrolling this fall will end up with a blended interest rate for their loan school loans similar to, or perhaps slightly lower than, the previous 6.8/7.9 structure.

:lol:

dstars823
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Re: FYI on student loan rates going forward

Postby dstars823 » Thu Jul 25, 2013 9:30 pm

guano wrote:
zman wrote:
dstars823 wrote:just hope for a super slow recovery so that bernanke has to keep the rates low and the money cheap


the economy will NOT recover as long as money is cheap and rates are low.
???


Paul Campos wrote:My guess is that people enrolling this fall will end up with a blended interest rate for their loan school loans similar to, or perhaps slightly lower than, the previous 6.8/7.9 structure.

:lol:


guess every law student will at least learn to work with compounded interest lol

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Cobretti
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Re: FYI on student loan rates going forward

Postby Cobretti » Thu Jul 25, 2013 9:43 pm

dstars823 wrote:guess every law student will at least learn to work with compounded interest lol

Its terrifying that there are people going into 250k+ debt over the last few years that don't understand compounded interest :|

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t-14orbust
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Re: FYI on student loan rates going forward

Postby t-14orbust » Thu Jul 25, 2013 9:45 pm

Cobretti wrote:
dstars823 wrote:guess every law student will at least learn to work with compounded interest lol

Its terrifying that there are people going into 250k+ debt over the last few years that don't understand compounded interest :|


http://investor.gov/tools/calculators/compound-interest-calculator

I'm glad I took a finance class lol

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laxbrah420
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Re: FYI on student loan rates going forward

Postby laxbrah420 » Thu Jul 25, 2013 10:00 pm

Hey Professor Alarmist, you write as if this is a variable rate loan. A bill that chooses to adjust the fixed rates of loans on a yearly basis as opposed to the old scheme of adjusting them every x years does not demonstrate that this bill in particular has created an arbitrage opportunity for the government. If you consider the practice of loaning any money w/ interest at near zero risk "arbitrage" then this bill does nothing. And you also have a fucked definition of arbitrage.

dstars823
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Re: FYI on student loan rates going forward

Postby dstars823 » Thu Jul 25, 2013 10:17 pm

Cobretti wrote:
dstars823 wrote:guess every law student will at least learn to work with compounded interest lol

Its terrifying that there are people going into 250k+ debt over the last few years that don't understand compounded interest :|


guess same could be said for all the americans who got shafted by not reading their subprime mortgages as well lol

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laxbrah420
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Re: FYI on student loan rates going forward

Postby laxbrah420 » Thu Jul 25, 2013 10:23 pm

What are you people even talking about? All of a sudden, because the low chance that inflation would cheapen law school down the road will be gone in a couple years, law students need to now learn what compound interest is?

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laxbrah420
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Re: FYI on student loan rates going forward

Postby laxbrah420 » Thu Jul 25, 2013 10:25 pm

Also how do you write an article that's entirely predicated on treasury yields rising and not even cite to the CBO study you mention? "Well, historical rates are higher, so you guys just got fucked!!!"
Barf.
Last edited by laxbrah420 on Thu Jul 25, 2013 10:41 pm, edited 3 times in total.

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guano
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Re: FYI on student loan rates going forward

Postby guano » Thu Jul 25, 2013 10:26 pm

laxbrah420 wrote:Hey Professor Alarmist, you write as if this is a variable rate loan. A bill that chooses to adjust the fixed rates of loans on a yearly basis as opposed to the old scheme of adjusting them every x years does not demonstrate that this bill in particular has created an arbitrage opportunity for the government. If you consider the practice of loaning any money w/ interest at near zero risk "arbitrage" then this bill does nothing. And you also have a fucked definition of arbitrage.

?????

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laxbrah420
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Re: FYI on student loan rates going forward

Postby laxbrah420 » Thu Jul 25, 2013 10:27 pm

guano wrote:
laxbrah420 wrote:Hey Professor Alarmist, you write as if this is a variable rate loan. A bill that chooses to adjust the fixed rates of loans on a yearly basis as opposed to the old scheme of adjusting them every x years does not demonstrate that this bill in particular has created an arbitrage opportunity for the government. If you consider the practice of loaning any money w/ interest at near zero risk "arbitrage" then this bill does nothing. And you also have a fucked definition of arbitrage.

?????

Isn't that what he wrote?

20141023
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Re: FYI on student loan rates going forward

Postby 20141023 » Sat Jul 27, 2013 3:58 pm

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Last edited by 20141023 on Sun Feb 15, 2015 10:39 pm, edited 1 time in total.

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t-14orbust
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Re: FYI on student loan rates going forward

Postby t-14orbust » Sat Jul 27, 2013 4:12 pm

kappycaft1 wrote:I am going 100% private loans, but still want to understand how federal lending of student loans is working. Accordingly, I have a quick question about this:

When you take out loans, is their interest rate "fixed" at the rate at which you borrowed them? For example, if someone took out unsubsidized loans at 5.4% and then the economy got better the following year and caused the interest to increase, would that mean that only any future loans would accrue interest at the new rate, or would the existing loans also change (like a variable loan) to the new rate as well?

Also, I find it kind of hilarious (in a sadistic sort of way) that the interest will likely be lowest when students have the least amount of debt, and then higher when they have to take on more debt. Good jerb government. :roll:


It's a fixed interest loan, so yes the rate would stay the same as when it was issued.

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untar614
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Re: FYI on student loan rates going forward

Postby untar614 » Sat Jul 27, 2013 4:14 pm

kappycaft1 wrote:When you take out loans, is their interest rate "fixed" at the rate at which you borrowed them? For example, if someone took out unsubsidized loans at 5.4% and then the economy got better the following year and caused the interest to increase, would that mean that only any future loans would accrue interest at the new rate, or would the existing loans also change (like a variable loan) to the new rate as well?

This is what I'm trying to figure out as well. Most people are telling me it's fixed at the rate from when you took it out, but I'm still not completely sure.

Also, I find it kind of hilarious (in a sadistic sort of way) that the interest will likely be lowest when students have the least amount of debt, and then higher when they have to take on more debt. Good jerb government. :roll:

If interest hits the caps and stays there, few professional students will be able to ever pay those off. I was helping my roommate do calculations for med school as he was unsure if he'd be able to get IS tuition. For med students, if they pay OOS/private tuition rates, don't have a really short residency and have ~10% interest, those loans aren't getting paid off. Luckily most can go work for a nonprofit hospital and get PSLF combined with PAYE. But the more ludicrous they make these loan rates, the more likely no one will even bother trying to pay them off and just go for forgiveness programs, in which case everyone treats it as monopoly money and just takes out maximum loans and lives it up (since IBR/PAYE makes loan amount irrelevant). No way that's helping our student debt issue.

20141023
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Re: FYI on student loan rates going forward

Postby 20141023 » Sat Jul 27, 2013 5:06 pm

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Last edited by 20141023 on Sun Feb 15, 2015 10:39 pm, edited 1 time in total.

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smus
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Re: FYI on student loan rates going forward

Postby smus » Sun Jul 28, 2013 1:11 pm

zman wrote:
Louis1127 wrote:Unfortunately interest rates will be going up right when I need student loans for LS. Errrrrggghhh.


it's not the interest rate that is the problem. It's the expensive tuition.



while tuition may eff you and me, the interest rate is whats going to eff the economy again (all of us) in a couple years.

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laxbrah420
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Re: FYI on student loan rates going forward

Postby laxbrah420 » Sun Jul 28, 2013 5:02 pm

kappycaft1 wrote:
untar614 wrote:
kappycaft1 wrote:When you take out loans, is their interest rate "fixed" at the rate at which you borrowed them? For example, if someone took out unsubsidized loans at 5.4% and then the economy got better the following year and caused the interest to increase, would that mean that only any future loans would accrue interest at the new rate, or would the existing loans also change (like a variable loan) to the new rate as well?

This is what I'm trying to figure out as well. Most people are telling me it's fixed at the rate from when you took it out, but I'm still not completely sure.

Also, I find it kind of hilarious (in a sadistic sort of way) that the interest will likely be lowest when students have the least amount of debt, and then higher when they have to take on more debt. Good jerb government. :roll:

If interest hits the caps and stays there, few professional students will be able to ever pay those off. I was helping my roommate do calculations for med school as he was unsure if he'd be able to get IS tuition. For med students, if they pay OOS/private tuition rates, don't have a really short residency and have ~10% interest, those loans aren't getting paid off. Luckily most can go work for a nonprofit hospital and get PSLF combined with PAYE. But the more ludicrous they make these loan rates, the more likely no one will even bother trying to pay them off and just go for forgiveness programs, in which case everyone treats it as monopoly money and just takes out maximum loans and lives it up (since IBR/PAYE makes loan amount irrelevant). No way that's helping our student debt issue.

Yeah, this is a downward-spiraling disaster. :|

No offense, but Id think someone who needs to write at treatise in order to ask if loans are fixed or variable rate shouldn't be prognosticating.

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swc65
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Re: FYI on student loan rates going forward

Postby swc65 » Sun Jul 28, 2013 5:15 pm

dstars823 wrote:as long as the recovery remains slow, students borrowing in the near term may actually see a slight reprieve say like 70-100 basis points, but if interest rates go back to historical averages we're all screwed.



Great! So as long as there are no jobs student loan will be cheap. :lol:

20141023
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Re: FYI on student loan rates going forward

Postby 20141023 » Sun Jul 28, 2013 7:42 pm

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Last edited by 20141023 on Sun Feb 15, 2015 10:38 pm, edited 2 times in total.

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laxbrah420
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Re: FYI on student loan rates going forward

Postby laxbrah420 » Sun Jul 28, 2013 8:16 pm

Youre pedaling doom and gloom to people you you presume to be ignorant about financial issues, while simultaneously asking for information from these same people.

20141023
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Re: FYI on student loan rates going forward

Postby 20141023 » Sun Jul 28, 2013 8:24 pm

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