loan help

Discuss various money matters here. Loans (federal and private), scholarships, lottery winnings, or other school finance related information and queries.
OhioU26
Posts: 35
Joined: Wed Jan 04, 2012 11:54 am

loan help

Postby OhioU26 » Tue Jun 19, 2012 12:33 pm

Hey guys i am working on my loans for law school next year. I need to take out 16,000. The Stafford subsidized loan has an interest rate of 6.8%. Every place says private loans are only to be used when your federal loans are exhausted. If I can get a private loan with the interest rate below 6.8% should I just go for that? Thanks for the help guys

Fark-o-vision
Posts: 590
Joined: Sun Dec 13, 2009 6:41 pm

Re: loan help

Postby Fark-o-vision » Tue Jun 19, 2012 12:38 pm

I think the answer lies in the difference between simple interest and compound interest. Simple interest saves you a ton over time.

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dingbat
Posts: 4976
Joined: Wed Jan 11, 2012 9:12 pm

Re: loan help

Postby dingbat » Tue Jun 19, 2012 1:08 pm

Depends - what's the rate if the private loan?
Is it a fixed rate or a variable rate?
Are there any other stipulations attached?

Keep in mind that private loans might not have the same rules regarding deferment, IBR, LRAP, PSLF, etc.

You need to weigh the pros and cons of the private and federal loans and see which one makes more sense

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rinkrat19
Posts: 13918
Joined: Sat Sep 25, 2010 5:35 am

Re: loan help

Postby rinkrat19 » Tue Jun 19, 2012 1:10 pm

After Stafford, there are Grad Plus federal loans. Private loans are not your only resort after that $16k.

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dingbat
Posts: 4976
Joined: Wed Jan 11, 2012 9:12 pm

Re: loan help

Postby dingbat » Tue Jun 19, 2012 1:14 pm

rinkrat19 wrote:After Stafford, there are Grad Plus federal loans. Private loans are not your only resort after that $16k.

Loving that 7.8% rate
I know hedge funds that don't expect that kind of return...

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cinephile
Posts: 3469
Joined: Sun Jul 18, 2010 3:50 pm

Re: loan help

Postby cinephile » Tue Jun 19, 2012 1:23 pm

You may want to exercise loan forgiveness options down the line that only apply to direct loans.




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