Student Loans

[Renegadenole]

A back story and a couple questions.

My daughter has student loans, which I have co-signed. The loans are through Sallie Mae and I assumed they were under the federal interest rate set to zero program. I know the payments are stopped for now by not sure about the interest. I’m trying to get her (and son-in-law) to consolidate while interest rates are low. I’ve offered to leverage one of my assets to get a good commercial loan rate. They think the gubment may payoff some debt for them and since they are not making payments they will just wait.

Questions -
- Is anyone familiar with the no interest accrued program and can elaborate on what qualifies. You’d think one could just look at the loans but not black and white
- If I leverage one of my assets to help her and son-in-law consolidate to one low interest commercial loan and the gubment decides to forgive some student debt will they be screwed.

I’ve asked my accountant but he didn’t know for sure. Plans to check around. Thought maybe some of you ED debt tards might know.

BTW - I spent over $35,000 on daughters education. Wasn’t near enough. Don’t ask.

 

[Don Johnson]

They should not be accruing interest right now because of covid. If you want to find out for sure about her specific loans just have your daughter take some responsibility and call and ask. Or if you co-signed, you should be able to call and find out yourself if need be. I’m not sure about the rest of your questions. My mom co-signed my loans and I took responsibility and paid the loans off myself. I do not make a ton of money but I was smart enough to get a degree without getting myself too far into debt. Full disclosure, I had a baseball scholarship which helped out tremendously. I am actually currently getting a masters degree which is being financed by the company I work for. I will say that I think it is great that you are trying to help your daughter get ahead in life. I have twins that turned one on Thursday (boy/girl) and I hope I am able to save enough to help them pay for their education like you.

 

[America 1st]

Do not pay them off.

You have until at least September before anything needs to be decided.

 

[poke2001]

A back story and a couple questions.

My daughter has student loans, which I have co-signed. The loans are through Sallie Mae and I assumed they were under the federal interest rate set to zero program. I know the payments are stopped for now by not sure about the interest. I’m trying to get her (and son-in-law) to consolidate while interest rates are low. I’ve offered to leverage one of my assets to get a good commercial loan rate. They think the gubment may payoff some debt for them and since they are not making payments they will just wait.

Questions -
- Is anyone familiar with the no interest accrued program and can elaborate on what qualifies. You’d think one could just look at the loans but not black and white
- If I leverage one of my assets to help her and son-in-law consolidate to one low interest commercial loan and the gubment decides to forgive some student debt will they be screwed.

I’ve asked my accountant but he didn’t know for sure. Plans to check around. Thought maybe some of you ED debt tards might know.

BTW - I spent over $35,000 on daughters education. Wasn’t near enough. Don’t ask.

Don’t consolidate unless it is with a government student loan consolation. If Biden pays them off, private loans won’t qualify.

Call and ask about interest. That said, it should be pretty simple to log in and see if interest is accruing.

 

[Renegadenole]

Don’t consolidate unless it is with a government student loan consolation. If Biden pays them off, private loans won’t qualify.

Call and ask about interest. That said, it should be pretty simple to log in and see if interest is accruing.

It appears interest is accruing (can’t find an amortization schedule). Everyone says not interest but that’s not what I’m seeing. Wondering why and is the something others are seeing with Sallie Mae loans. Plan to call them Monday.

 

[poke2001]

It appears interest is accruing (can’t find an amortization schedule). Everyone says not interest but that’s not what I’m seeing. Wondering why and is the something others are seeing with Sallie Mae loans. Plan to call them Monday.

I think only federal loans are subject to it. Sallie Mae are private loans. Go ahead and consolidate, Biden isn’t paying those off.

 

[Jtrain80]

How do we know if they are private or gov loans?

 

[poke2001]

How do we know if they are private or gov loans?

If the government lended the money, it’s a government loan.

 

[Renegadenole]

I think only federal loans are subject to it. Sallie Mae are private loans. Go ahead and consolidate, Biden isn’t paying those off.

Yep. That’s what I get out of it. “Federally backed” loans through Sallie Mae. Not a “federal loan”. Only federal loans are subject to zero interest but even the fed backed loans have payment paused.

She was under the impression (and me too I assumed) that the interest was set to zero until September but that’s not what I see when I look at the loans. Seems most people think the Sallie Mae interest is zero. It’s not a black and white deal.

 

[Renegadenole]

They should not be accruing interest right now because of covid. If you want to find out for sure about her specific loans just have your daughter take some responsibility and call and ask. Or if you co-signed, you should be able to call and find out yourself if need be. I’m not sure about the rest of your questions. My mom co-signed my loans and I took responsibility and paid the loans off myself. I do not make a ton of money but I was smart enough to get a degree without getting myself too far into debt. Full disclosure, I had a baseball scholarship which helped out tremendously. I am actually currently getting a masters degree which is being financed by the company I work for. I will say that I think it is great that you are trying to help your daughter get ahead in life. I have twins that turned one on Thursday (boy/girl) and I hope I am able to save enough to help them pay for their education like you.

Paying for your kids education is part of the problem. (Government money the other part of the problem). I had a deal with my two daughters that I would pay off half at graduation and for them to work it out so they would have some skin in the game.
Had no idea the kind of money she could borrow with my name attached. I signed one time on the first loan. Didn’t see anything for a few years after that. Thought she was borrowing the standard 8,000 or 10,000 per year. So parent, keep a close eye on that stuff. Can’t believe it happened on my watch. I’m a full out budget and transaction reconciliation hawk.

Was not a good time in the Renegadenole family when I stumbled on the loans unsuspectingly.

 

[Renegadenole]

How do we know if they are private or gov loans?

Good question. All I can see is Sallie Mae. No other lender or institution anywhere. I assumed it was a federal loan(s)

 

[Renegadenole]

Do not pay them off.

You have until at least September before anything needs to be decided.

I’m not sure this is the correct information.

What I want to do is leverage an assets to put them in a good commercial loan at 3.5-4 percent 20 yr amortization with a 5 year ballon. They can take the loans at 5 years when they have there in equity and chops.
Current loans are 7-10 percent 10yr Amortization. Of course they aren’t paying them rn so all is good. Except they are being charged interest. My concern is convert the Sallie Mae loans and then pudding does some student debt deal and they are out. But if you wait until September interest rates are increasing and interest is accruing. I’m pissed at the whole situation.

 

[America 1st]

I’m not sure this is the correct information.

What I want to do is leverage an assets to put them in a good commercial loan at 3.5-4 percent 20 yr amortization with a 5 year ballon. They can take the loans at 5 years when they have there in equity and chops.
Current loans are 7-10 percent 10yr Amortization. Of course they aren’t paying them rn so all is good. Except they are being charged interest. My concern is convert the Sallie Mae loans and then pudding does some student debt deal and they are out. But if you wait until September interest rates are increasing and interest is accruing. I’m pissed at the whole situation.

We got notice on ours (Wife and I) that puddin pushed everything thru September (at least) before anything kicks back in. Remember that he will likely try to do something long before that or keep pushing it back (so he can win political points).

No advice on what to do with the rest of your decisions brother but just wanted to offer up my experience.

Hopefully some others will be able to help confirm.

 

[Jtrain80]

Paying for your kids education is part of the problem. (Government money the other part of the problem). I had a deal with my two daughters that I would pay off half at graduation and for them to work it out so they would have some skin in the game.
Had no idea the kind of money she could borrow with my name attached. I signed one time on the first loan. Didn’t see anything for a few years after that. Thought she was borrowing the standard 8,000 or 10,000 per year. So parent, keep a close eye on that stuff. Can’t believe it happened on my watch. I’m a full out budget and transaction reconciliation hawk.

Was not a good time in the Renegadenole family when I stumbled on the loans unsuspectingly.

Daughter in school, paying cash so far. Indians helping also.

If I didn't have student debt, I would probably mow yards for a living.

 

[Renegadenole]

Thanks. I’m not sure there is a knowable answer. My post/rant is as much PSA as looking for advice. Wondered if anyone on the board was looking at it the same way right now. My oldest daughter and her longterm BF/husband (got married in January) will be fine. Very sharp couple and he is VP material some day. Just sucks the cost and the way the system is put together.

 

[poke2001]

Paying for your kids education is part of the problem. (Government money the other part of the problem). I had a deal with my two daughters that I would pay off half at graduation and for them to work it out so they would have some skin in the game.
Had no idea the kind of money she could borrow with my name attached. I signed one time on the first loan. Didn’t see anything for a few years after that. Thought she was borrowing the standard 8,000 or 10,000 per year. So parent, keep a close eye on that stuff. Can’t believe it happened on my watch. I’m a full out budget and transaction reconciliation hawk.

Was not a good time in the Renegadenole family when I stumbled on the loans unsuspectingly.

That was the deal I had. I was required to have some skin in the game...most of mine came in form of scholarship and retained scholarship but ultimately had some loan. My parents picked up 1/2 in form of parent loan and we had a deal that if I didn’t finish, I took those over.

 

[TarCock29]

Sounds like if they are accruing interest you have no incentive to delay refinancing. Unless you want to pay interest only until September. When refinancing be sure, if you haven't already, to pay attention to the interest rates for all the current loans. I know when I looked some of my current rates were lower than the refinance rate offered.

Due to that when it gets closer to September I don't plan on refinancing all of the loans, just those over 5%. That way I can still have balances available for other freezes or payoffs from Uncle Sam.

 

[Renegadenole]

Sounds like if they are accruing interest you have no incentive to delay refinancing. Unless you want to pay interest only until September. When refinancing be sure, if you haven't already, to pay attention to the interest rates for all the current loans. I know when I looked some of my current rates were lower than the refinance rate offered.

Due to that when it gets closer to September I don't plan on refinancing all of the loans, just those over 5%. That way I can still have balances available for other freezes or payoffs from Uncle Sam.

It’s a thought to leave a couple of the better loans just in case pudin makes some funds available. But, there are loan fees to consider when you consolidate and the hassle of it all to break up the process.
I can easily put them in a 20yr loan with ~4 percent interest. My thoughts are to lean forward and not wait for government handouts. They, being young, firmly believe the government is going to throw them a bone. Did I mention the whole thing really frustrates me. Reminds me of the line “I’m from the government and I’m here to help”.