Researching student loans, wow my head is spinning. Any info?

[Mrs. Ciz]

There simply isn't enough 'free' aid to go around. Period. Yes, some of these huge schools have fat endowments...with big restrictions on how they can dole that money out. Big U also has fat athletic programs...they get (and give) boatloads of cash to talented athletes who by their talent raise (or keep) the school in the limelight.

Most students or parents with any expectation that they will get enough 'free' aid to go to the school of their choice/dreams/desires just because they worked hard and got great grades is going to be disappointed. The great shot for free rides (ala National Merit scholarships) have their fates sealed through their PSAT and/or SAT scores taken in their junior year of HS.

I have known some very smart hard working students. One in particular was studying engineering at Rutgers University and doing very well. Some aid, but mostly of the student loan variety (which again, IS classified as aid).

You're both correct. I wasn't trying to imply that the frugal family would not come out ahead in the long run.
I was responding to another poster's comment that the government doesn't want to subsidize families who have spent foolishly rather than saving. Since EFC is partly based on how much you have saved (parents are expected to contribute 5.64% of their savings-- and students an even higher percentage), the non-savers are in fact being subsidized because their children will qualify for more financial aid (since they will have a lower EFC than the savers).

My DH had a really hard time understanding this! He was angry that our 529 Prepaid College Savings Plan made our EFC higher. He kept saying we got screwed because we saved; now our kid won't get any aid. What he failed to realize is that most aid is NOT free; it is of the loan variety. In the end we are much better off and will pay less overall because we DID save. We won't have to take out loans to meet our EFC. We won't have to pay back $$$$ in interest. It is sometimes hard for folks to understand all the ins and outs, especially when it's their first kid and first college funding experience.

 

[LynnTH]

I've been following this thread carefully. DS17 will soon be a Senior. He will not get any scholarships of any kind. (good in sports but not great and has about a B average). We are from Minnesota and our state has reciprocity with North Dakota, South Dakota and Wisconsin. So these are the 4 states we are looking at and are only looking at state schools. We don't have much saved up for college as both kids have been in private schools through out school. The tuition was not bad up through 8th grade. (Church School). But quadrupled going into high school. We went back and forth on this and the kids really wanted to go here and we made it work, and it has been the best thing for them. But they also knew going in that we would not have enough for college and they would have to pay some and may have to take out some student loans. We are hoping it does not come to that but if it does it will be minimal.

This thread has been very helpful with the different types of aid and loans. So much to learn. I guess I thought that on all student loans that the interest did not start accumulating until after they graduate - guess I was wrong on that. Good to know.

 

[msmayor]

I guess I thought that on all student loans that the interest did not start accumulating until after they graduate - guess I was wrong on that. Good to know.

Interest accumulates from the day it is 'disbursed'. The only difference is that on any subsidized portion of a student's Stafford loan, the interest is paid for by the government until the repayment period begins. All unsubsidized Stafford loans and private student loans have interest accumulate from day one, as do all Parent Plus loans. If you don't pay the interest (and you always have the option to pay that interest as it is charged) then it is capitalized into the principal and added to the balance of the loans.

 

[LuvOrlando]

There simply isn't enough 'free' aid to go around. Period. Yes, some of these huge schools have fat endowments...with big restrictions on how they can dole that money out. Big U also has fat athletic programs...they get (and give) boatloads of cash to talented athletes who by their talent raise (or keep) the school in the limelight.

Most students or parents with any expectation that they will get enough 'free' aid to go to the school of their choice/dreams/desires just because they worked hard and got great grades is going to be disappointed. The great shot for free rides (ala National Merit scholarships) have their fates sealed through their PSAT and/or SAT scores taken in their junior year of HS.

I have known some very smart hard working students. One in particular was studying engineering at Rutgers University and doing very well. Some aid, but mostly of the student loan variety (which again, IS classified as aid). Sadly, by the end of his sophomore year, his 'aid' ran dry...he couldn't qualify for any more loans. Tapped out on the Federal side and with no more private resources available, he had to suspend going to school. Six months later, he had to start making payments on those loans ($60k worth). So now, this bright and talented student who DID receive aid is trying to pay for the equivalent of a BMW on a Ford Fiesta paycheck.

College CAN be affordable, and every student that wants a degree can be successful without spending a fortune. Yes, there are some companies and fields where an Ivy League or degree from one of the major well-known universities is going to be 'useful', but if a kid is such a hard worker and go-getter, then a degree from lesser known schools (that may be more affordable) shouldn't hold them back.

That story is so tragic. What do you mean he ran out how did he run out? From what I gathered on sitting in on the financial aid meetings the federal aid and stateaid seem to be kind of a yearly given assuming that the kids family's financial situation doesn't change dramatically. My sons closest friend is a multiethnic genius ( of course the schools didn't flag him in that way because his parents went through a divorce in the middle of middle school and he didn't have anybody to advocate for him :/ so things dipped a bit but trust me he is one) who able to go to Penn State because they have so much state and federal funding in addition to Penn State Alumni money. In addition to handling my sons situation I am also trying to help this young man (and another friend) navigate because his mom is ESL and his dad is MIA. Is there something schools aren't telling me/us?

 

[LuvOrlando]

The problem with this line of thought is you are equating grades with effort and motivation. Plenty of 3.8 students put next to nothing in- then you have the learning disabled kids who work 10x as hard and will fight their way through. Maybe they have a 3.0, but they understand the material and have learned to fight for what they have and truly earn it without any recognition. They don't get a pat on the head every report card, they don't get the scholarship, the award, they get "well maybe if you were more like X" (who is out getting ice cream while they reread the science chapter for the 4th time)

Equating good grades in high school with motivation is how we justify assigning grades in the first place. It helps the kids who test well feel good about themselves. It's not a very good predictor of much, a significant portion of the truly successful people in this world did not do well in high school. I would think it's more the high GPA kids who go "just because they can" and because it's expected- they've been being told for years they are the best kid around- so they follow the next step and sign up for college. I suspect the kids with lower grades who struggled through would be more likely to succeed if money was taken out of the equation.
I wish there were more scholarships for "struggled like hell, ended 3rd grade 3 grade levels behind and still pulled through skipping everything fun to be a solid B- student."

Ohh ok, I get it. This isn't about college financial aid, this is a dialogue about how much you disagree with the valuation of grades & formal education. I won't disagree, there are lots of ways to be successful that do not demand formal education, but IF you are a person who is looking to be in a field that demands the particular skills and precision of a formal education, such as a neurosurgeon or Federal Reserve Economist then I think that particular kid needs to get on the same page as the field he/she wants to engage & an agreed upon education is sort of demanded. You can't even get into some fields without passing various licensing exams so test taking will remain a necessity for some beyond the SATs. If a kid isn't doing anything with that sort of vibe then I think he/she should seriously consider what path is best for him or her. & shouldn't give a second thought to this path if it's not theirs. But, this thread was started because my kid is actully looking to go into one of of the former sorts of disciplines so the whole grades & formal education issue does matter for me so here I am.

 

[LuvOrlando]

I've been following this thread carefully. DS17 will soon be a Senior. He will not get any scholarships of any kind. (good in sports but not great and has about a B average). We are from Minnesota and our state has reciprocity with North Dakota, South Dakota and Wisconsin. So these are the 4 states we are looking at and are only looking at state schools. We don't have much saved up for college as both kids have been in private schools through out school. The tuition was not bad up through 8th grade. (Church School). But quadrupled going into high school. We went back and forth on this and the kids really wanted to go here and we made it work, and it has been the best thing for them. But they also knew going in that we would not have enough for college and they would have to pay some and may have to take out some student loans. We are hoping it does not come to that but if it does it will be minimal.

This thread has been very helpful with the different types of aid and loans. So much to learn. I guess I thought that on all student loans that the interest did not start accumulating until after they graduate - guess I was wrong on that. Good to know.

I have one senior & one Jr and totally get it. I kept trying to get answers but it's just so muddy. I think the biggest misalignment with public understanding & reality is student loans are no longer for the students , kids can only take out about 31k in stafford loans while PARENTS are the ones taking out misnamed student loans. It's awful

 

[msmayor]

That story is so tragic. What do you mean he ran out how did he run out? From what I gathered on sitting in on the financial aid meetings the federal aid and stateaid seem to be kind of a yearly given assuming that the kids family's financial situation doesn't change dramatically. My sons closest friend is a multiethnic genius ( of course the schools didn't flag him in that way because his parents went through a divorce in the middle of middle school and he didn't have anybody to advocate for him :/ so things dipped a bit but trust me he is one) who able to go to Penn State because they have so much state and federal funding in addition to Penn State Alumni money. In addition to handling my sons situation I am also trying to help this young man (and another friend) navigate because his mom is ESL and his dad is MIA. Is there something schools aren't telling me/us?

Its actually quite easy to 'run out'...

First of all, Stafford Loans have an annual limit. $5500 total Freshman year, $6500 Sophomore year and $7500 Junior and Senior years. This is not even enough to cover a year's tuition at some schools. If there are not sufficient savings and current work earnings of the student and/or parents to supply the rest, and no 'free' grant aid is offered, then the money has to come from somewhere.

I have seen 'full aid packages' for schools that cost $35,000 per year offer $5500 in Stafford Loans and $38,500 in Parent Plus Loans. Its a 'full aid package' but ALL loans.

Now perhaps parents don't want to take that much in loans, if at all...and there isn't enough savings. That leaves private Student Loans if the student themselves doesn't have the money. These are a 'little' harder to qualify for but at some point even the private lenders will say "enough!". That's what happened to this guy. He had no more ready funds in savings, and the banks said "no more". His parents did not want to take on loans themselves.

My daughter's friend from HS ended up in the same boat, though at least not so far into debt. She lasted freshman year at an expensive school. She had some 'free' money, but there was the full Stafford loan and almost all of whatever had been saved for college. By Sophomore year, the college savings was already exhausted. Parents could not get loans on their own and (wisely) refused to cosign on private loans for their daughter. She had to stop...and finally started back up again after a 2-year gap going to community college. Had she started there from the get-go she would have qualified for FREE tuition under our state's program of rewarding high school academic achievement and would have been able to save her college fund money for the last 2 years at a 4-year institution.

 

[LuvOrlando]

Its actually quite easy to 'run out'...

First of all, Stafford Loans have an annual limit. $5500 total Freshman year, $6500 Sophomore year and $7500 Junior and Senior years. This is not even enough to cover a year's tuition at some schools. If there are not sufficient savings and current work earnings of the student and/or parents to supply the rest, and no 'free' grant aid is offered, then the money has to come from somewhere.

I have seen 'full aid packages' for schools that cost $35,000 per year offer $5500 in Stafford Loans and $38,500 in Parent Plus Loans. Its a 'full aid package' but ALL loans.

Now perhaps parents don't want to take that much in loans, if at all...and there isn't enough savings. That leaves private Student Loans if the student themselves doesn't have the money. These are a 'little' harder to qualify for but at some point even the private lenders will say "enough!". That's what happened to this guy. He had no more ready funds in savings, and the banks said "no more". His parents did not want to take on loans themselves.

My daughter's friend from HS ended up in the same boat, though at least not so far into debt. She lasted freshman year at an expensive school. She had some 'free' money, but there was the full Stafford loan and almost all of whatever had been saved for college. By Sophomore year, the college savings was already exhausted. Parents could not get loans on their own and (wisely) refused to cosign on private loans for their daughter. She had to stop...and finally started back up again after a 2-year gap going to community college. Had she started there from the get-go she would have qualified for FREE tuition under our state's program of rewarding high school academic achievement and would have been able to save her college fund money for the last 2 years at a 4-year institution.

Ohh ok, so it's not so much that it ran out its that the parents stopped absorbing the expense- which is running out just in a different kind of way.

From what I understand if a parent fails qualifying for the parent plus loans (likely for credit rating reasons) then the child can get quite a bit more in Stafford loans. Still, Stafford is not enough to take it all on. After all is said and done with grants & Stafford first run plus the Penn State Alumni gift my son's best friend will have $5800 a semester that they have to either put into parent plus or something else. I have been reminding him to apply for the parent plus with his mom so that the school can open up additional funding to him for Stafford and I think he'll just about make it.

Thank goodness this young man is brilliant because he will be able to manage work-study in addition to a full credit load.

Whole process is dizzying, everybody here is really helping me to sort out my thoughts & I appreciate it

 

[LuvOrlando]

My DH had a really hard time understanding this! He was angry that our 529 Prepaid College Savings Plan made our EFC higher. He kept saying we got screwed because we saved; now our kid won't get any aid. What he failed to realize is that most aid is NOT free; it is of the loan variety. In the end we are much better off and will pay less overall because we DID save. We won't have to take out loans to meet our EFC. We won't have to pay back $$$$ in interest. It is sometimes hard folk folks to understand all the ins and outs, especially when it's their first kid and first college funding experience.

I think there is a big disconnect in the use of the word "aid" and they really should be forced legally to stop using it because it causes so much confusion that leads to bad choices. I don't walk into a car dealership and hear the finance guy call the loan I need "financial aid" & I don't walk into a realtor looking to buy a house and hear the agent call my mortgage "financial aid" so why on earth can they do it here?

It's bizarre

 

[msmayor]

I think there is a big disconnect in the use of the word "aid" and they really should be forced legally to stop using it because it causes so much confusion that leads to bad choices. I don't walk into a car dealership and hear the finance guy call the loan I need "financial aid" & I don't walk into a realtor looking to buy a house and hear the agent call my mortgage "financial aid" so why on earth can they do it here?

It's bizarre

It is bizzare...but if you really think about it it IS aid.

First of all, there is a portion of the annual limit of Stafford Loans offered each year where the government is absorbing the interest cost. For BOTH Stafford and PLUS loans, no payment at all is necessary until 6 months after the student benefiting from the loan has stopped attending full-time. I know of no car loan or mortgage that will let you not make a payment for 4-5 years. The government is helping with that interest payment, in effect...giving aid.

Once the repayment period begins, there are a myraid of options for the student to design a monthly payment that can fit in their budget. That doesn't exist for car loans and mortgages. Your payment is your payment. Period. So while they ARE loans, there is great flexibility in paying them back. The government servicer agreeing to accept a smaller payment or, in some circumstances, allowing a period where there are no payments at all after graduation (additional forbearance)...is giving aid.

The biggest problem with this aid is the refusal of some students and parents to really sit and figure out how you are going to pay all this back BEFORE you even set foot on campus. You can't just say "Well, lets get the loans and we'll figure out how to pay it back later.". Its not as restrictive to qualify for Stafford and PLUS loans as some people think (for our daughter, there was a year when my husband was actually unemployed, yet he qualified for a Parent PLUS loan to help us through the hump...but we had a plan to get it paid off) and its sad when a student gets to the end of the road, degree in hand, and has the equivalent of a small six-figure mortgage to pay off.

Parents also need to remember that a decision to stay away from PLUS loans and have the student take out private loans in their own name isn't always going to work either. Often they will require a co-signer, and the minute Mom or Dad cosigns for that loan, THEY are now on the hook. The full balance of that student's loan will count against them on their credit score and could actually hinder Mom and Dad's ability to get credit for a car loan or a mortgage.

 

[Sadie22]

Loans can be part of a package of financial aid which might include merit-based scholarships, financial-need-based grants, and an on-campus job. Before high school is not too early to be thinking about where and learning how the financial aid process works. Late junior year of high school and the senior year of high school is very late to be starting to learn about the process, investigating schools, etc.

 

[LuvOrlando]

It is bizzare...but if you really think about it it IS aid.

First of all, there is a portion of the annual limit of Stafford Loans offered each year where the government is absorbing the interest cost. For BOTH Stafford and PLUS loans, no payment at all is necessary until 6 months after the student benefiting from the loan has stopped attending full-time. I know of no car loan or mortgage that will let you not make a payment for 4-5 years. The government is helping with that interest payment, in effect...giving aid.

Once the repayment period begins, there are a myraid of options for the student to design a monthly payment that can fit in their budget. That doesn't exist for car loans and mortgages. Your payment is your payment. Period. So while they ARE loans, there is great flexibility in paying them back. The government servicer agreeing to accept a smaller payment or, in some circumstances, allowing a period where there are no payments at all after graduation (additional forbearance)...is giving aid.

The biggest problem with this aid is the refusal of some students and parents to really sit and figure out how you are going to pay all this back BEFORE you even set foot on campus. You can't just say "Well, lets get the loans and we'll figure out how to pay it back later.". Its not as restrictive to qualify for Stafford and PLUS loans as some people think (for our daughter, there was a year when my husband was actually unemployed, yet he qualified for a Parent PLUS loan to help us through the hump...but we had a plan to get it paid off) and its sad when a student gets to the end of the road, degree in hand, and has the equivalent of a small six-figure mortgage to pay off.

Parents also need to remember that a decision to stay away from PLUS loans and have the student take out private loans in their own name isn't always going to work either. Often they will require a co-signer, and the minute Mom or Dad cosigns for that loan, THEY are now on the hook. The full balance of that student's loan will count against them on their credit score and could actually hinder Mom and Dad's ability to get credit for a car loan or a mortgage.

It's only aid if you also consider credit cards as an aid to buying things, you may well consider it that. I do not, I consider the interest on loans as the 'cost' of borrowing because I'm paying for it, nobody's doing me a favor by extending the credit. I was able to buy my new central air system from Lowe's with zero interest for six months but I also don't consider that aid. But that's just me

 

[LuvOrlando]

Loans can be part of a package of financial aid which might include merit-based scholarships, financial-need-based grants, and an on-campus job. Before high school is not too early to be thinking about where and learning how the financial aid process works. Late junior year of high school and the senior year of high school is very late to be starting to learn about the process, investigating schools, etc.

I get it but I don't think the majority of people understand this until they are trying to sort it all out. I did try and read a bunch of books and it's still very very muddy because there are countless variations of ways to pay for things. Plus as I said before the colleges don't want to talk to you until you're an accepted student and that puts you only a few months out.

The thing is, colleges are selling us something and it is certainly not in their best interest to advocate for us as consumers because once we start talking to our kids younger the big dreams become better grounded in reality and most people wouldn't have that emotional blackmail thing going on .

I think they should call it a financial package and leave the word aid out of the whole thing, unless the comments apply to the portion actually providing assistance in the form of scholarship or grants that don't need to be paid back

 

[crisi]

I don't think the majority of people really try to understand it. They put blinders on when the topic comes up - maybe if they ignore it, it will go away. They don't want to borrow trouble - after all, their kid is a good student and a starting pitcher - maybe there will be scholarship money. And you know, Harvard is free to middle class parents - a lot of the big name schools with huge endowments are (of course, getting into one isn't likely).

I've had discussions with other parents since elementary school explaining the same thing - if you are even close to middle class, there will be no federal grants. Your financial aid will come in the form of loans and work study - work study not being much. If you go private, the school may have some money to hand out - but public colleges and universities seldom do. Yes, Harvard is free - and it has a 7% acceptance rate (to which one mother replied that since her high school Junior was in the top 3% of her class, Harvard wouldn't be a problem.) Large scholarships are rare. The parents put their hands over their ears and start saying lalalalalala to block out the harsh reality.

On the other hand, our schools - at least mine - does a lousy job. They push kids to college starting in elementary school - but the workshops for parents don't start until Junior year. The school should be sitting down with parents and the high school counseling team when the kids are in kindergarten and say "here are the possible paths for your child from now until the day they finish high school - and the post high school options including the military, technical school, getting a job, going to college, or living in your basement. And if you think your kid is college bound, stay an extra half hour and we will talk about how it gets paid for."

 

[teller80]

First of all, there is a portion of the annual limit of Stafford Loans offered each year where the government is absorbing the interest cost.

You have to qualify for this type of loan, I don't think too many people do.

For BOTH Stafford and PLUS loans, no payment at all is necessary until 6 months after the student benefiting from the loan has stopped attending full-time. I know of no car loan or mortgage that will let you not make a payment for 4-5 years. The government is helping with that interest payment, in effect...giving aid.

I don't really define it as helping, it's just deferring your payments while accruing interest.

The government servicer agreeing to accept a smaller payment or, in some circumstances, allowing a period where there are no payments at all after graduation (additional forbearance)...is giving aid.

While accruing interest.

The biggest problem with this aid is the refusal of some students and parents to really sit and figure out how you are going to pay all this back BEFORE you even set foot on campus. You can't just say "Well, lets get the loans and we'll figure out how to pay it back later.". Its not as restrictive to qualify for Stafford and PLUS loans as some people think (for our daughter, there was a year when my husband was actually unemployed, yet he qualified for a Parent PLUS loan to help us through the hump...but we had a plan to get it paid off) and its sad when a student gets to the end of the road, degree in hand, and has the equivalent of a small six-figure mortgage to pay off.

I agree with this 100%.

 

[supersnoop]

It's only aid if you also consider credit cards as an aid to buying things, you may well consider it that. I do not, I consider the interest on loans as the 'cost' of borrowing because I'm paying for it, nobody's doing me a favor by extending the credit. I was able to buy my new central air system from Lowe's with zero interest for six months but I also don't consider that aid. But that's just me

Are those student loans offered based on your credit worthiness? I don't think so, and that's why it's considered "aid." It's money that you are allowed to borrow based solely on the fact that the kid is going to college. It's not based on your credit score like credit cards and personal loans.

 

[LuvOrlando]

I don't think the majority of people really try to understand it. They put blinders on when the topic comes up - maybe if they ignore it, it will go away. They don't want to borrow trouble - after all, their kid is a good student and a starting pitcher - maybe there will be scholarship money. And you know, Harvard is free to middle class parents - a lot of the big name schools with huge endowments are (of course, getting into one isn't likely).

I've had discussions with other parents since elementary school explaining the same thing - if you are even close to middle class, there will be no federal grants. Your financial aid will come in the form of loans and work study - work study not being much. If you go private, the school may have some money to hand out - but public colleges and universities seldom do. Yes, Harvard is free - and it has a 7% acceptance rate (to which one mother replied that since her high school Junior was in the top 3% of her class, Harvard wouldn't be a problem.) Large scholarships are rare. The parents put their hands over their ears and start saying lalalalalala to block out the harsh reality.

On the other hand, our schools - at least mine - does a lousy job. They push kids to college starting in elementary school - but the workshops for parents don't start until Junior year. The school should be sitting down with parents and the high school counseling team when the kids are in kindergarten and say "here are the possible paths for your child from now until the day they finish high school - and the post high school options including the military, technical school, getting a job, going to college, or living in your basement. And if you think your kid is college bound, stay an extra half hour and we will talk about how it gets paid for."

I don't think it's as simple as saying parents are wearing blinders.

To be honest this particular thread is the most eye opening read I've been exposed to ever. I'm not dumb and I've been looking for a while. I feel so lucky I happened to call USAA 5 years ago asking about how best to prepare for loans for my kids and they explained that ALL loans are for us not them & I admit it was a "huh" moment. As a result, I still tarted saving so we DIDN'T get new cars & were cautious with vacations and such in preparation for what I suspected was on its way. Frankly, I don't think it's an accident that things are so opaque. These misunderstandings are what's driving the bus on many many educations that would totally go a different way if everyone knew what was actually going to happen so why on earth would the schools remove the leverage they have over us?

I agree the high schools don't do a great job preparing us all for what's to come but with all they are trying to accomplish just getting kids to a basic literacy levels with funding cuts I can't say I'm surprised.

 

[LuvOrlando]

Are those student loans offered based on your credit worthiness? I don't think so, and that's why it's considered "aid." It's money that you are allowed to borrow based solely on the fact that the kid is going to college. It's not based on your credit score like credit cards and personal loans.

ok if that's how you see aid.

To me this is like saying that unemployment benefits would also be a helpful kind of aid if they needed to pay it back. I sort of think no but I bet some people would think it was

 

[crisi]

I don't think it's as simple as saying parents are wearing blinders.

To be honest this particular thread is the most eye opening read I've been exposed to ever. I'm not dumb and I've been looking for a while. I feel so lucky I happened to call USAA 5 years ago asking about how best to prepare for loans for my kids and they explained that ALL loans are for us not them & I admit it was a "huh" moment. As a result, I still tarted saving so we DIDN'T get new cars & were cautious with vacations and such in preparation for what I suspected was on its way. Frankly, I don't think it's an accident that things are so opaque. These misunderstandings are what's driving the bus on many many educations that would totally go a different way if everyone knew what was actually going to happen so why on earth would the schools remove the leverage they have over us?

I agree the high schools don't do a great job preparing us all for what's to come but with all they are trying to accomplish just getting kids to a basic literacy levels with funding cuts I can't say I'm surprised.

I sort of feel like the opposite - I'm always a little shocked when people don't understand how this works. Its like people suddenly wake up one day to the realization that college is expensive, there isn't a lot of free money for it, and most of what you will get will be loans at market rates. I wonder if they have been wearing blindfolds. The big posters for college loans at Wells Fargo aren't there because there is ample public funds - and Wells Fargo is advertising them because they make money off them.

 

[crisi]

You have to qualify for this type of loan, I don't think too many people do.



I don't really define it as helping, it's just deferring your payments while accruing interest.



While accruing interest.



I agree with this 100%.

And this is why you start saving when they are in the cradle and set realistic expectations on what is affordable. Its unlikely that anyone but you or your child will end up paying for the vast majority of their education. If you save for it, interest can work for you. If you don't save for it, interest will work against either you or your kid.