I have a brutal student loan(sallie mae signature student, 14.25% and balance is currently 13k) from undergrad...it makes me sick thinking about it.
I am starting graduate school this Fall...what is the best way to lower the interest rate on this money? I was thinking of asking for an increase of budget so I can take out a larger gradplus loan which is a fixed, much lower rate to pay off my undergrad loan. I'm asking the school if such a large increase is even possible...is this legal or would I have to have other reasons like medical expenses?
Are there any other options if this is unlikely or impossible? Is it true that consolidating private loans is pretty much pointless because they just create a weighted interest rate?
Roostar said: I have a brutal student loan(sallie mae signature student, 14.25% and balance is currently 13k) from undergrad...it makes me sick thinking about it.
I am starting graduate school this Fall...what is the best way to lower the interest rate on this money? I was thinking of asking for an increase of budget so I can take out a larger gradplus loan which is a fixed, much lower rate to pay off my undergrad loan. I'm asking the school if such a large increase is even possible...is this legal or would I have to have other reasons like medical expenses?
Are there any other options if this is unlikely or impossible? Is it true that consolidating private loans is pretty much pointless because they just create a weighted interest rate?
The school won't give you an increase to pay this off, it would be similar to them giving you an increase to pay off your high interest credit cards or car loan.
Mithrin
Nerdy Member
posted: Jun. 27, 2007 @ 11:01a
I don't think that you can request a budget increase to pay off debts.
Your best bet is to take out the max amount of loans allowed using the standard cost of attendance, and then find a way to live below that amount (save on housing with roommates, make your own meals, walk/bike to school to save on gas and car maintenance, etc). You could also pick up a part time job to earn some extra money to apply towards the loan too.
Also, I don't know what field your in, but at least in the sciences, it's usually pretty easy to get funding as a TA, and at least at my school, the financial aid doesn't count the TA salary as part of your aid package (since it's considered wages). So they will allow you to get federal loans up to the cost of attendance, while the TA position pays for tuition, plus a decent amount per month to live on. 1-2 years as a TA, and you could easily turn the Sallie Mae loan into Stafford loans with much lower interest.
Well, at least try to get as much new graduate student loan money as possible through Stafford loans and GradPlus to pay down this terrible loan (ie: take all you can get and try to ask for more). Thier rates are much better (respectively fixed 6.8% and 7.9%). Also, you might try finding another private loan that has better rates than this one. While it may not be better than the government loans, it could very well be better than 14.25%.
1. You can take out a new private loan with a rate of 7, 8 or 9%. Use the money to pay off ur 14% loan and keep the lower rate loan. Get a good loan at MyRichUncle.com, or maybe try a credit union, they have low rates sometimes.
2. Get a good job this summer and it pay it off.
3. Balance transfer part of the loan to a 0% card.
4. Do an AOR and use ur earnings to pay off as much of the loan as u can.
Good luck!
ShowMetheMoney23
Member
posted: Jun. 27, 2007 @ 8:07p
I wouldn't recommend transfering to a low balance credit card as that student loan debt will turn into a revolving credit line which will jack up your credit card utilization and kill your credit score.
There are private loan consolidation companies that will re-assess your interest rate based on credit score. Similar to refinancig a mortgage. The loan in consolidation will stay listed as student loan on your credit report...Make sure that they have an in school deferment provision as not all do.
You can ask for a budget increase at many schools for
(1) a single computer purchase (show a "receipt"--we know how easy that is)
(2) increase in budgeted cost of living. Show a copy of your lease with rent higher than what they budget for (again show them a "lease")
That will get you maybe 3K. Generally, cost of living estimates are more than what you really need. If you can live cheaply one year, buy your books online, or used, or hell go without them in some cases, you can save tons of $$. Then pay off the older debt. Do a 0% BT for any remainder, and spread the cost of the loan across multiple years of graduate school. By then end you might have most of it paid off.
You may also take out a private loan. Like an earlier poster said, hovering around 9% interest.
14% is higher than some of my credit cards...!
BossPup
Cranky Member
posted: Jun. 28, 2007 @ 6:09a
ShowMetheMoney23 said: I wouldn't recommend transfering to a low balance credit card as that student loan debt will turn into a revolving credit line which will jack up your credit card utilization and kill your credit score.
There are private loan consolidation companies that will re-assess your interest rate based on credit score. Similar to refinancig a mortgage. The loan in consolidation will stay listed as student loan on your credit report...Make sure that they have an in school deferment provision as not all do.
If he can get a fixed for life 2.9% offer from a CC, I would absolutely do it. Unless you are planning to buy a home in the near future, the difference in interest rates is too good to pass up.
Roostar
Greedy Member
posted: Aug. 6, 2007 @ 3:16p
ShowMetheMoney23 said: I wouldn't recommend transfering to a low balance credit card as that student loan debt will turn into a revolving credit line which will jack up your credit card utilization and kill your credit score. There are private loan consolidation companies that will re-assess your interest rate based on credit score. Similar to refinancig a mortgage. The loan in consolidation will stay listed as student loan on your credit report...Make sure that they have an in school deferment provision as not all do.
Are there any companies that are better than others with this?
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