Question for you who have kids going or have gone to college

[mommy22gurlz]

I have a senior in HS and I can't believe it, but we are preparing for college! I really have no clue on anything as far as loans, etc. DH and I did not attend college so this is new to both of us. We do not have a college fund for her so we will be getting loans to pay, so I need info.

First off, I believe she will be going to University of Houston ( she will already have about 40 hours from our local community college). I know about Fafsfa, I don't think we will qualify for grants because of our income, per a friend of mine who didn't get approved for financial aid either so looks like loans will be the route we have to take.

I hear federal loans are the way to go and are fairly easy to get? Does anyone know if the loans will be in dd's name or ours? Do you have to have a certain credit score? I've heard they first can go in dd's name and if it isn't enough money then there are parent loans to make the difference. U of H is fairly cheap compared to alot of other colleges, it will be roughly 10K/yr for tuition so I'm thinking maybe she can get enough loans to cover it? DH and I are paying for it but I just have this horrible fear that somehow our credit won't be good enough or we won't qualify for loans, and writing out 5K checks every semester really isn't feasible for us.

Can you guys give me the scoop on how all of this flows??
Thanks!!

 

[My sister's princess]

I have a senior in HS and I can't believe it, but we are preparing for college! I really have no clue on anything as far as loans, etc. DH and I did not attend college so this is new to both of us. We do not have a college fund for her so we will be getting loans to pay, so I need info.

First off, I believe she will be going to University of Houston ( she will already have about 40 hours from our local community college). I know about Fafsfa, I don't think we will qualify for grants because of our income, per a friend of mine who didn't get approved for financial aid either so looks like loans will be the route we have to take.

I hear federal loans are the way to go and are fairly easy to get? Does anyone know if the loans will be in dd's name or ours? Do you have to have a certain credit score? I've heard they first can go in dd's name and if it isn't enough money then there are parent loans to make the difference. U of H is fairly cheap compared to alot of other colleges, it will be roughly 10K/yr for tuition so I'm thinking maybe she can get enough loans to cover it? DH and I are paying for it but I just have this horrible fear that somehow our credit won't be good enough or we won't qualify for loans, and writing out 5K checks every semester really isn't feasible for us.

Can you guys give me the scoop on how all of this flows??
Thanks!!

Not a parent, but a full time student, who works in the financial aid office!

The very best thing to do is make sure that she gets her FAFSA in on time. You can do it as early as January 1st and I would recommend doing it as soon as you can, most places have a priority deadline (ours is April 15th). Even thought you don't think she will be eligible you might be surprised! Federal Stafford loans, which go into your daughter's name are awarded through this process. These loans are special loans that she can get even without a credit score, and are federally guaranteed. Once you fill out her FAFSA the school will contact you (my school awards new students in Feb.) They will send you information about additional loans, if her financial aid package doesn't cover everything. Many schools also offer a payment plan, so if you want to cover part of the costs that may be an option for you.

 

[AshleyW]

I have a senior in HS and I can't believe it, but we are preparing for college! I really have no clue on anything as far as loans, etc. DH and I did not attend college so this is new to both of us. We do not have a college fund for her so we will be getting loans to pay, so I need info.

First off, I believe she will be going to University of Houston ( she will already have about 40 hours from our local community college). I know about Fafsfa, I don't think we will qualify for grants because of our income, per a friend of mine who didn't get approved for financial aid either so looks like loans will be the route we have to take.

I hear federal loans are the way to go and are fairly easy to get? Does anyone know if the loans will be in dd's name or ours? Do you have to have a certain credit score? I've heard they first can go in dd's name and if it isn't enough money then there are parent loans to make the difference. U of H is fairly cheap compared to alot of other colleges, it will be roughly 10K/yr for tuition so I'm thinking maybe she can get enough loans to cover it? DH and I are paying for it but I just have this horrible fear that somehow our credit won't be good enough or we won't qualify for loans, and writing out 5K checks every semester really isn't feasible for us.

Can you guys give me the scoop on how all of this flows??
Thanks!!

Ooooh, I can help!! I go through this EVERY year, it's fairly simple.

She needs to fill out her FAFSA. It's not just for grants, it's also for federal loans. As she's under 25, she'll need you and your husband to enter in your income information as co-signers. After they process her FAFSA, she'll get an award letter telling her what she qualified for - grants, subsidized loans, unsubsidized loans, etc.

My parents make quite a bit of money - but their credit isn't very good due to some past medical problems, and I'm still able to get all the loans I need. If she only needs $10k, she should be able to get that in loans from FAFSA no problem. If she doesn't, then you & your husband can get a parent loan (I think it's called PLUS), OR she could get a private student loan through a bank. I had to get a loan through Wells Fargo to cover my dorm bill my freshman year, and it was easy as pie.

 

[sue1013]

I can't help you with the loan questions but there may be an alternative. We had money put away for our kids college but didn't use it. Instead the school had a payment plan they split the yearly cost over 10 monthly payments. We decided to try it when the first one went we figured if it wasn't working out we would pull from the bank. We ended up doing this for both kids worked out for us.

 

[Lisa loves Pooh]

Unless you get a PLUS loan (I think that is what it is or was called), all loans are under your dd's name only. However, she will utilize your tax information in the FAFSA process. B/c even if you are inelegible for free money, she can't get the loan money with out it.

She should also spend her spring and her summer in a new job--APPLYING FOR EVERY SCHOLARSHIP she can get her hands on. Regardless of her chances of actually getting it. Much scholarship money goes unrewarded b/c noone applies. I recall on the DAve Ramsey show, a callers sharing that her dd did this. She applied for tons of scholarships and was bummed that she got only a small percentage. They almost felt it a waste of time until they added the money together and realized she had won 10s of thousands in scholarship money. (Something like $30K or so.)

FYI--if the school has any scholarships, they can only reward them to those who fill out the FAFSA in most cases. Even if the scholarship money is purely academic and not need based.

In the end, she should be earning a degree that will help her pay these loans in the end. There has been many a tale of students going into high debt for a degree that pays low in the real world and then they struggle in paying it off. Student loans are NOT bankruptable and you are pretty much bound to paying them regardless of your post-college financial situation.

Additionally--there is more to college expenses aside from tuition. Do not forget, books, lab fees, supplies, room, and board as well incidental need-based items such as toiletries and such. $10K per year can become $15-$20K real quick. She needs a plan to pay for the difference via job or parental contribution or both.

I had a scholarship that essentially covered my tuition and I still graduated with 4 years of debt to the tune of $15K, 13 years ago. Tuition at the time was rougly about $2K for 12 hours per semester. Then I still supplemented with jobs and in my final semester, a FT , 40 per hour a week job. In the last 2 years, I had some small grants as well. So figure--that though my tuition was covered, I still had expenses that were more than double my tuition.

 

[kafitty]

In the end, she should be earning a degree that will help her pay these loans in the end. There has been many a tale of students going into high debt for a degree that pays low in the real world and then they struggle in paying it off. Student loans are NOT bankruptable and you are pretty much bound to paying them regardless of your post-college financial situation.

i was reading an article once, about people paying back their loans, and some kid was whining because he owed like $135,000 while getting his theater arts degree at some fancy private school...i mean, really?! i would have LOVED to go into performing arts as my major, but i stuck with Political Science, but i am SO wishing i went into business or something with "real" job skills attached.

 

[geffric]

check out the interest rate on the loans.. we went to a college seminar and they told us it was 8-9% on the loans.. we were only getting 3% on the money so the bank of mom and dad may be cheaper and we charge 5%..

also don't forget that the money she earns at school and during the summer can be applied.. check out college connections website for more ideas/

 

[Mickey'snewestfan]

i was reading an article once, about people paying back their loans, and some kid was whining because he owed like $135,000 while getting his theater arts degree at some fancy private school...i mean, really?! i would have LOVED to go into performing arts as my major, but i stuck with Political Science, but i am SO wishing i went into business or something with "real" job skills attached.

You know my younger brother who majored in Theater Arts is doing better than I am financially, with my Poli Sci degree. He took what he learned about presentation skills, and the tech experience he got working on lighting design, and built a great career developing and running training programs on high tech networking hardware. I would call those "real skills".

My degree was in "Soviet politics" (by the time I graduated there was no Soviet Union, how's that for an obsolete degree), but I use the writing, research and statistical analysis skills it taught me every day in my current work.

I will tell my child to major in whatever makes his heart sing. I think the chances of success, however you define that, are greatest when you're passionate about what you're learning an creative about figuring out how to apply that.

 

[Lisa loves Pooh]

I wasn't talking about degrees that some consider worthless.

There are jobs that require degrees, but do not pay much to start. Graduating with high 5-figure or 6-figure debt to make a job that starts out at $20,000-$25,000 a year is crazy.

A career is what you make of it, but often students aren't considering the long term impact of their finances when they opt to finance their degrees.

I got a television production degree. I ended up getting a job outside of that field upon graduation, but even in that field, my loans were not too high in comparison to my income if I went out and really worked it. But my loan was only $15,000.

Had I not had a scholarship AND I financed all of my degree, the loan would have been more like $30,000-$40,000. That is not commensurate with my realistic earning potential in the real world with that degree. But there are many who go on successfully to earn respectable incomes.


I was simply commenting that one should take the realistic earning potential of what they really wish to do and take that into consideration when getting loans. Some passions are just not high income even at their peak.

Realistically--most students do not do that at all.

 

[golfgal]

She should also check with the high school guidance counselor and see what local scholarships are available. Some are need based but most are not. Also, depending on her GPA, she may qualify for some scholarships at the college itself and in order to do so you still have to fill out the fed financial aid forms.

At $10K/year, chances are, if you are going this route, you could pay $1000/month over the year and have it paid for. If you don't want to "pay" for college, she could take "loans" out from you to do that. I am a FIRM believer that EVERY college student should take out at least ONE student loan in order to establish a credit rating after college and to get into the habit of paying bills.

We also have a high school senior so we are going through this now as well. He is getting one scholarship from the school because his Grandpa is an alumni and he did well enough on his ACT to qualify for another. We are waiting to hear about others he has applied for. Also, go online to the various scholarship websites and sign up for those. There are a lot of weird ones out there but you can also find many local and regional ones as well as ones put out by various businesses.

 

[Feralpeg]

As long as we are talking about FAFSA, I have what is probably a really dumb question. My daughter is a college senior about to begin her final semester. I have filled out the FAFSA since she started college. The scholarship money for the Spring 2010 semester was designated at the beginning of the Fall 2009 semester. Do I still need to fill out the FAFSA with my 2009 tax info?

 

[erincon23]

Honestly, not much to add, but we also have a HS senior heading to college next year. I appreciate the comment from Mickey'sfan about getting a degree that makes your heart sing -- in my son's case, that's really it -- he plans to go to college for jazz performance, playing tenor sax and singing! We're in the process of looking at scholarship info -- there are several websites -- fastweb.com, scholarship.com and others, in addition to the college's own financial aid site -- where you can get info and applications for different programs. My son's likely school (he still has to audition, but we're keeping our fingers crossed) says Feb. 1 is a common scholarship application deadline. Look at everything in her background -- ethnicity, ancestor's country, DAR, religion, intended major -- my nephew got $5,000 a year for four years because he's 1/4 Hispanic! Even though your daughter has been going to a community college, go back to her high school counselor and ask about programs that might be available. Good luck!

Erin

 

[golfgal]

As long as we are talking about FAFSA, I have what is probably a really dumb question. My daughter is a college senior about to begin her final semester. I have filled out the FAFSA since she started college. The scholarship money for the Spring 2010 semester was designated at the beginning of the Fall 2009 semester. Do I still need to fill out the FAFSA with my 2009 tax info?

No, because the FAFSA you would fill out for now would be for the 2010-2011 school year, the one you did last year covers this school year.