I heard student loans are easy to pay off yet people compare them to credit card debt. Is this true?
2006-12-28 03:36:08 · 11 answers · asked by Frankie D 1 in Education & Reference ➔ Financial Aid
my credit card: prime plus 5.99% (variable)
my student loans: 4.75% (fixed)
considering that currently my cc interest rate (if i carried a balance) would be about 10% higher than my student loans, it's hard to put them in the same category.
2006-12-28 03:45:03 · answer #1 · answered by John V 4 · 0⤊ 0⤋
Something to take into consideration is that the majority of the US has student loans.
Federal loans are a great form of financial aid because unlike credit card debt, the government wants you to pay off your balance; because you are a liability to them and they are not a bank. They are choosing to guarantee your loan without knowing what your credit looks like.
I think that comparing them to credit card debt is an elementary mistake.
Do you have a debt you must repay? Yes. This is the only common factor.
Interest rates are lower, repayment is less expensive and easier to handle, and there are more options available if you can't make a payment.
On top of this, the subsidized loan does not have interest while you are in school and the majority of students qualify for this loan! Just think, that is 2 to 4 or maybe 6 years of having debt and not paying for it.
Federal student loans are a good thing. Do not make the mistake of comparing them to credit card debt.
2006-12-28 05:17:17 · answer #2 · answered by Mrs. Murphy 2 · 0⤊ 0⤋
Are they good or bad, it is totally a matter of opinion.
I believe that a person should do whatever it takes to get a higher education, but I also feel the whole student loan program is getting out of hand since it is just another way for the government to make money. If they made college affordable to everyone it would be a win-win situation for our entire society.
Not that I like the guy, but even Saddam Hussien allowed all citizens of Iraq to attend college, even women.
As far as paying off you loan, they cost to pay it back is usually pretty low, but the repayment program kicks in as soon as you finish school and it is assumed that you found a good paying job which is not always the case.
2006-12-28 04:01:06 · answer #3 · answered by BionicNahlege 5 · 1⤊ 0⤋
well if you really don't need a loan and are just looking at it as extra money don't get it. You don't need it.That's how some people get so far in debt that in the end isn't quite worth it. Student loans are better than other loans. When you graduate you don't have to start paying it back, they usually give you a 6 month grace period.
2006-12-28 05:00:55 · answer #4 · answered by bramos100702 1 · 0⤊ 0⤋
only use them as last resort. It is important to get a higher education but if you have to foot the bill yourself without help from family try to work during summers and save like crazy. Community colleges are a way to reduce the cost by attending them at a much reduced cost then finishing at a 4 year. Remember that you will have to pay back those loans at the same time you will be starting a career and possibly a family as well.
2006-12-28 05:43:15 · answer #5 · answered by tman 5 · 0⤊ 0⤋
They're neither good nor bad. In the right hands, credit is a useful tool. In the wrong hands, credit is the key to trouble. It's not the loan, but the attitude of the borrower that determines which way things will work out.
2006-12-28 03:44:59 · answer #6 · answered by Jack430 6 · 1⤊ 0⤋
Student loans are the best debt to have! As long as you pay them regularly, they give you a very positive view to the eyes of creditors. I think people mostly compare them to credit card debt, because they are very daunting in large amounts. As long as you are up-to-date on your payments, student loans do nothing but positive things for you.
2006-12-28 03:41:55 · answer #7 · answered by Anonymous · 1⤊ 0⤋
They are a double edge sword! They can get pretty high! not to mention that if you pause payments your interests can hike up.
Do your homework before you jump into one. my wife is paying over 30gs in student loans and i dont see her paying them off before she dies!
Theres always the military which give you what they call the GI BILL. Free school money for serving a minimum of 4 yrs.
Good luck!
2006-12-28 03:47:42 · answer #8 · answered by hondalos11 3 · 1⤊ 0⤋
They are easier to deal with than cc debt. They adjust or defer your paymnt depending on your income after college. Credit cards do'nt do that. Plus, you get to defer them if you go back to school. Credit cards suck. Don't ever put college expenses on one unless you have maxed out all of the other loan possibilities.
2006-12-28 03:40:30 · answer #9 · answered by Anonymous · 1⤊ 0⤋
student loans have been already federal. it is why you be conscious for federal student help. The invoice that merely surpassed in basic terms takes the banks out of the image. The banks have been merely the intermediary, the money continually got here from the government. It makes the technique plenty less demanding.
2016-11-24 20:07:53 · answer #10 · answered by krausz 4 · 0⤊ 0⤋