Student Loans And The Credit Crisis
The credit crisis of today isn’t just hitting people with homes or cars, its hitting students that want to go to college, that are in college or are out of college. Student loans are now harder to get and a lot of people are being turned down due to the credit spot that our nation is facing.
Most students try to get a federal grant or loan because of the fixed rate in which they can pick up with this type of loan but even these loans are harder to pick up and may even get an interest rate hike also. The students that can’t get federal loans are then turned to private loans where they will have variable rates. These loans take years longer to payoff and are part of the credit crunch being felt by students and alumni. My personal student loan has a variable rate and trust me, its no where close to being paid off. I know a man that is in his mid thirties and is an IT tech at a very well known and very wonderful company where I live and he makes top-notch money for where we live and he is still paying on his student loans. The guy did go to Auburn though and thats not cheap.
Some of the problems that have caused the student loan crisis are people defaulting on loans and either haven’t paid them assist or just can’t pay them. Even a small student loan with a variable rate can end up being a big burden on anyone with everyday bills even if you have a degree and make good money. A lot of lenders have also stopped giving out student loans to a lot of people and have narrowed down people with more criteria to be met before you get any money. That means if you are going to a smaller school or are taking out a limited amount of money then you could be denied due to the criteria in place at some banks. If you don’t have good credit then you probably won’t get a private loan unless you get a co signer.
The mortgage crisis has build a lot of banks in debt and so has school loans. Student loans are getting harder to find because a lot of banks don’t want to select on the debt and the risk of this kind of money. The biggest problem today is the fact that college is getting more and more expensive. The cost of books, food, and room and board have risen across the board. Loans that students can get when they are available aren’t nearly enough to cover the costs of school anymore. College students now face not having enough money to make it through school even if they get a loan.
The best advice that you can rob is to look around at all options for student loans and don’t take the first thing that comes at you. I would also suggest going to a community college for two years before you go to a four year school because that will keep you tons, trust me. Good luck and honorable hunting.
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Filed under Student Loans Without Cosigner by on Dec 18th, 2011. 