Where to find best student loan

[karliebug]

My daughter is a junior in college and will need to get a loan for next year (on top of the federal loans she already receives). Can anyone tell me where to look for the best rates? Any idea about what a good rate/term for a student loan even is?? TIA

 

[RangerPooh]

Have you contacted the financial aid office at the school that she will be attending at the time for recommendations? All of mine were taken out through the schools that I attended, but the rates for those weren't too bad.

Some schools do offer plus loans that involve co-signers (parents). Not sure if that's an option for you.

 

[hpfan100]

My daughter is a junior in college and will need to get a loan for next year (on top of the federal loans she already receives). Can anyone tell me where to look for the best rates? Any idea about what a good rate/term for a student loan even is?? TIA

Are you looking for private lender student loans? Or just any student loan? The private lender market is tricky but I would consider the bank you use or credit union if possible and look into Sallie Mae which also does traditional federal programs also. I would avoid any loans that you do not absolutely need to get. Private loans will have much higher rates then the ones from the feds. The common rate for fed loans is anywhere from 4-8 % while a private may be up to 30 or more.

I would check with university financial aid office for more options. Usually they carry a list of common lenders available.

 

[karliebug]

she already gets federal loans for about $5000 per semester but she needs more than that now. I got an email from sallie mae and I know our credit union does student loans but I just wondered if anyone knew what a "good" rate was that I should be looking for. We would cosign for her, but it would be her loan.

 

[libraryfreak]

Because she's so young and has no credit history, chances are her interest rates will be much higher than if you applied for the loan. Since you want to be a co-signer on her loan, it's the same as if you took out the loan (if she doesn't pay they'll go after you,) so check into private loans for you.

DO NOT use your house as collateral, i.e. - a home equity loan. The rates may be good, but it's not worth the risk (unless you can afford to pay the loan off.)

 

[louey]

If the parents assume the loan will it be deferred until the child graduates? Where as if the child gets the loan with parent/co-signer it would be deferred? I don't know I am just asking.

 

[FINFAN]

If the parents assume the loan will it be deferred until the child graduates? Where as if the child gets the loan with parent/co-signer it would be deferred? I don't know I am just asking.

yes, if it is a parent Plus loan it can be deferred, we will be signing that option in January...you get the loan rolling, tell the FA Officer at the college that you will be deferring and you will be notified in January to enable that option. If some parents are unsire of taing a loan in their name, you can have an agreement drawn up for the student to sign stating their requirement for re[ayment...monthly amount etc. However, it will be on the parents credit report that they do have this loan out. However, in general, educational debt is not looked upon as bad as say, having 2 car loans, a boat loan and high CC debt.

 

[martikus]

The Parent PLUS loan is the easiest to get (if parent has good credit). It CAN be deferred until student graduates, though interest starts accruing. You apply through your school or studentloans.gov if the school is signed up for that. Interest is 7.9%. If parent is denied PLUS based on credit, student can apply for up to an additional $5000 in federal direct loan through school. The Parent PLUS is in parent's name and parent must repay it.

As a junior, student can receive $7,500 in federal direct loans.

Private loans - try to find one with no fees (no origination fee, no repayment fee).

Your daughter probably doesn't have enough credit to apply by herself so you will need to co-sign. Some lenders let the co-signer drop off after 24 on-time payments.

A lot of the states are offering decent private loan products now that they lost stafford loans. Check if your state offers something.

I'm partial to FIXED loans. While private loan might have a good rate now if it is variable, when the economy starts doing better the rates on the private loan can soar.

A great list of private loan lenders:

http://www.finaid.org/loans/privatestudentloans.phtml

Definiteley check with your credit union too. Some private lenders will allow loan to defer until student graduates. Some require interest payments, etc.

Good luck. Best advice I can offer - don't borrow a penny more than she absolutely needs. Student loan debt can really saddle a student as they enter the work force since most people don't get huge paying jobs starting off.