The Insider: College Admissions Advice from the Experts

Over the years, I’ve spoken with many college students and graduates whose greatest wish is a magic wand to make their student loans disappear.  While magic wands are a rare commodity in college finance, there does exist a tool for making your loans vanish into thin air.  It is called Public Service Loan Forgiveness.

A recent New York Times op-ed shared a controversial view on educational loans: it is fine to borrow and never pay them back. A few days later, a rebuttal piece criticized author Lee Siegel and the New York Times for their “deeply irresponsible op-ed.” At College Coach, we are passionate about providing the best advice available with respect to college aid, and we felt we had to provide our own perspective for those families who might have read Siegel’s original piece.

If you graduated this past spring and used student loans as part of your college financing strategy, you likely just received (or will soon receive) your very first student loan bill.  For many graduates, this first bill can come as an unwelcome surprise.  Sure, you knew you had to pay these loans back someday, but now that that day is here, and you see the size of your expected monthly payment, you may be feeling unprepared to handle repayment.  Rest assured:  if that monthly payment seems unaffordable based on your current financial circumstances, you do have some options.  The government offers a number of repayment plans for your federal education loans, some of which may provide you with some relief:

In breaking student loan news, this afternoon President Obama signed an executive order designed to provide repayment relief to struggling student loan borrowers.  Obama’s plan attempts to relieve student debt pressures and decrease defaults in three primary ways:

Part One: What is a Federal Parent PLUS Loan, and how do I get one?

Yesterday brought breaking news for student loan borrowers:  we now know what Federal Direct Loan interest rates will be for the 2014/15 school year!  Though rates are officially set for the upcoming academic year based upon the 10-year Treasury Note rate in effect on June 1^st, the U.S. Treasury Department just held its last scheduled Treasury Note auction prior to that June 1^st deadline, giving us a sneak preview of next year’s rates.  For loans disbursed between July 1, 2014 and June 30, 2015, interest rates will be as follows:

Is Student Loan Reform Good News for Federal Loan Borrowers?

If Senator Elizabeth Warren of Massachusetts gets her way, there will be good news on the horizon for federal student loan borrowers. Warren recently announced on her blog that she will be introducing new legislation to allow graduates with high interest rate student loans to refinance those loans at rates “at least as low as those now being offered to new borrowers in the federal student loan program.” Warren points out that “when interest rates are low, homeowners can refinance their mortgages. Big corporations can swap more expensive debt for cheaper debt. Even state and local governments have refinanced their debts.” But student loan borrowers cannot currently refinance their debt at prevailing interest rates through any existing federal program. The current federal student loan consolidation program allows borrowers only to lock in a weighted average of all of their existing interest rates, not necessarily get themselves a lower interest rate.

Reader Beware: Clearing up Student College Loans for Parents

In our developing “Reader Beware” series, College Coach finance experts seek to correct inaccurate college finance information shared in the popular press. The goal is to help families make well-informed college finance decisions rather than relying on assumptions, half-truths, and misinformation picked up from inexpert sources. In this second installment of the series, we take a look at a recent article in the St. Louis Post-Dispatch entitled College Loans Can Trap Unwary Parents.

It seems hard to pick up a newspaper these days without running into advice from College Coach finance expert, Robert Weinerman!