speedemon90

So it looks like i'm gonna be going to USC to get my masters and I'll also be taking out a student loan for the first time and wanted to know what you guys have done or heard about.

I was offered a Unsubsidized stafford loan (federal loan) for 21k total (10.5k each semester) and its offered with an interest rate of 6.3 or 6.9% i forgot, and then if i need more money (which I do) i can take out a direct plus loan (also federal) as much as i want with an interest rate at 7.9% and a 4% fee (not sure if the fee goes towards payment of the loan cause it seems ridiculous otherwise...

Anyway the subsidized loan will only cover half my tuition so I will need to take out at least another 10k each semester totaling to 20k. And I was wondering if you guys have had any experience with any private loans or should i just stick with federal loans?

gatrhumpy

iTrader: (1)

Wait until you can find an employer that will pay for your Master's Degree.

If you can't I would go Federal.

Will Y.

I have only had state and federal loans.
Friends who had financial problems also had private loans with much higher interest rates and more problematic terms than the state or federal loans (look to see when payments start).

Go with the state/federal loans first, if the 4% fee and higher interest rate did not dissuade you from private loans to start.

speedemon90

too late lol, and doesnt always happen with engineering degrees i think... I need a masters to get a decent job as well

speedemon90

so here's the thing, i'm maxing out my stafford loan from the state which has a 6.8% IR and 1% origination fee (that goes toward the principal iirc)

Then I'll need even more money and the only federal is the PLUS loan which has a 7.9% IR and a 4% fee.

I'm definitely taking out the stafford loan, but i think i may go private for the PLUS loan. The biggest lender i see is sallie mae, and they have fixed variable between 5.9%-12.2% ( i guess depending on my credit) and variable from 2.2%-10.2% roughly.

My question is, how risky our variable rates? Or should i always do fixed? I dunno how variable rates work, i'm guessing on how the market is.

TLtrigirl

iTrader: (1)

i took out a private loan for grad school my first yr from a bank. i swear they compounded the interest daily. in the end i ended up paying this one off first since the interest was ridiculous (it wasn't high it just seemed like it was being compounded daily). i dont' remember the exact terms, but if i had to do it all over...i would have gone a different route. i maxed out all of my federal loans (subsidized and unsubsidized) every yr to cover tuition. i eventually worked to cover the rest (living expenses etc).

stick with fixed interest rates. in today's market and economy...

luckily i was part of the era where i was able to lock in a low interest rate through loan consolidation (2%) when all was said and done with school.

doopstr

I'd recommend fixed as interest rates are pretty damn low now which means that eventually they have to go up.

Read the fine print on these loans where you need a cosigner. Make sure your cosigner understands that they are on the hook if something happens to you (ie. death). I did a favor for someone once, they ended up dying and I got handed the bill for about $8,000.

speedemon90

i see, yea i think i may just stick to federal more for the sake of deferring payments if i'm unemployed or such.

I dont get a subsidized loan damn grad student rules

speedemon90

another reason to do federal, i want as little of my parents involvement as possible. They did enough for me by paying for undergrad (whatever fafsa didnt cover) and my brother is gonna start going to college and they're doing the same for him. So i dont want them to cosign. And also federal loans are wiped out with death...

HBaJ

SpeedDemon, have you considered Sallie Mae? Took out a loan from them last year, got a little over 10k and an interest rate around 9%. Pays to have a parent cosign.

Not the best, but it could be worse. If you do the smart option and pay it back as you go, it drops a bit as well.

speedemon90

i looked at it, but i just ended up going with federal. I can possibly get a lower % with them, but federal loans are more forgiving with unemployment and such. Just in case, I ever need something to help out.

subinf

You can always start with a parent co-signing for the loan and then remove them once you make a certain amount of on time payments.

speedemon90

its so sad to see interest adding up everyday haha $53 so far