Student loan structure today....

[Trajan]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

 

[Annie]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

I don't know about that. I graduated university in '77 and my roomie bought a car with student loan $$. Now I had small loans, all were due to the the bursar's office. My parents thought it important that my brother and I learn the 'costs' of borrowing. It was a good lesson, until the past year I've always had an excellent credit rating.

 

[Trajan]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

I don't know about that. I graduated university in '77 and my roomie bought a car with student loan $$. Now I had small loans, all were due to the the bursar's office. My parents thought it important that my brother and I learn the 'costs' of borrowing. It was a good lesson, until the past year I've always had an excellent credit rating.

hummm...thx annie, we are close in age then ....either my mind is shot, which is a distinct possibility or my experience is a one off....

 

[Annie]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

I don't know about that. I graduated university in '77 and my roomie bought a car with student loan $$. Now I had small loans, all were due to the the bursar's office. My parents thought it important that my brother and I learn the 'costs' of borrowing. It was a good lesson, until the past year I've always had an excellent credit rating.

hummm...thx annie, we are close in age then ....either my mind is shot, which is a distinct possibility or my experience is a one off....

I'm guessing that like myself, what you 'borrowed' was owed in total. Seems that many borrow the max or in any case, more than they 'need.' Thus they get a check. Just guessing here.

 

[Trajan]

I don't know about that. I graduated university in '77 and my roomie bought a car with student loan $$. Now I had small loans, all were due to the the bursar's office. My parents thought it important that my brother and I learn the 'costs' of borrowing. It was a good lesson, until the past year I've always had an excellent credit rating.

hummm...thx annie, we are close in age then ....either my mind is shot, which is a distinct possibility or my experience is a one off....

I'm guessing that like myself, what you 'borrowed' was owed in total. Seems that many borrow the max or in any case, more than they 'need.' Thus they get a check. Just guessing here.

yes. I never considered asking for more than the tuition cost...I can tell you this, I have been thinking about this for a coupla days, I am dead sure that they never issued me a check in my name.

 

[rightwinger]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

Not the way I remember it. I got a student loan in the mid 70's and the check went to me to spend where I needed it.

I needed a car

 

[Trajan]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

Not the way I remember it. I got a student loan in the mid 70's and the check went to me to spend where I needed it.

I needed a car

thx for your input...oh, hey,

did you ever pay it back?

 

[rightwinger]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

Not the way I remember it. I got a student loan in the mid 70's and the check went to me to spend where I needed it.

I needed a car

thx for your input...oh, hey,

did you ever pay it back?

Of course

Back then, my tuition was $1050 a year. Think I borrowed $1500 for the car. Paid it off the first year out of school

 

[WorldWatcher]

>

That's interesting, my daughter is currently enrolled in college, her student loans are paid directly to the school. If the amount deposited in her account exceeds the cost of tuition and fees, then she can receive a disbursement from the school for the remaining balance. Which is the way disbursements are described on the federal student loan page ((LINK). Theoretically any overpayment for allowed expenses should be paid back, that decreases the principal and therefore payments post-graduation.

Now the reality is that next year our daughter has a very good chance of continuing a scholarship that she received this year that covers all of tuition and fees, a stipend for books, and a stipend towards living expenses. "Payback" for the scholarship is work after college for at least 4-years. Now this is where it gets complicated. Plans are for her to move out of the dorm into an apartment near campus, she did a cost analysis and the cost of the apartment (rent+utilities) is actually pretty close to the "room" cost in a dorm. Her meal costs will be lower cooking for herself then the meal-plan options so that saves some money. However, as part of the rental agreement (which is solely in her name, not ours) they required that she take out student loans (as a means of ensuring she had income enough to cover rent). So if the scholarship continues, both it and the loan amount will be deposited in her school account. Once tuition and fees are paid for the semester, the school will issue her the balance in a check. She can use that check to pay rent, "bank" it for future terms, or repay it against the principal. Her analysis (and she's a mathematics major) shows that with the scholarship stipend + what she makes working part-time she should be able to cover the rent & food without the loan. Well - that's the plan anyway. Next year we will check results. If it works she plans on investing the overpayment on subsidized loans (0% interest) for the final two years and paying off the unsubsidized loan from last year (she received both types).

Our fingers are crossed, over the 4-years she will have had about $72,000 (Tuition, Fees, Room, Board) in education expenses and will only have $3,500 in Student Loans to pay back (well if you don't count the 4-years for her future employment). (We had two years at a University under a Prepaid Education Plan, which is what paid tuition the first year before getting the scholarship this year. (If this works, we'll be able to transfer that remaining/unused year to her brother to pay tuition for his senior year).



A parent does what a parents gotta do.


>>>>

 

[Quantum Windbag]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

It actually depended on the lender. My loan payment went to the college, and I got a refund for the amount I did not spend. Others I know never saw any money, and one guy got a check for the full amount and paid the college out of that. Funny thing is, he ended up with the largest debt of anyone I know.

Today students get money from loans and grants to pay all expenses, including rent. I hope you taught your daughter about financial responsibility, and that the lessons hold through her college years.

 

[Trajan]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

It actually depended on the lender. My loan payment went to the college, and I got a refund for the amount I did not spend. Others I know never saw any money, and one guy got a check for the full amount and paid the college out of that. Funny thing is, he ended up with the largest debt of anyone I know.

Today students get money from loans and grants to pay all expenses, including rent. I hope you taught your daughter about financial responsibility, and that the lessons hold through her college years.

thx QW. Thats is exactly what I was thinking, when she told me this, I was like wait a minute, whats to stop anyone from blowing it and just dodging the loan? Or going back and getting another one and another, running along on D's or f's, they only have to prove they are in school for 12 credits when they get a payment request, they get 6 months to start payments there after they leave school for whatever reason. AND she could ostensibly get the student loans for more than her tuition, as I alluded came too. I was never offered any more than the tuition cost.

Talk about Moral hazard? Then it hit me , cynical yes but hey, never underestimate a politicians foresight as to buying votes, since the gov. will now be making all of decisions as to making the loans, whats to stop them say 4-8 years down the road declaring a moratorium or forgiveness for the debt because of a bad economy?

 

[mudwhistle]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

All of this "Free Money" floating around with no accountability.

It's like the Sub-prime lending debacle. They loan money to thousands of people that don't have any qualifications, then they get stiffed on the loan. A Pell grant is not a loan, I supposed, but student loans are going to be the cause of another economic meltdown.

 

[rightwinger]

So, in the old days, when I got my student loans. I never saw the check. I got paperwork from the school, brought it to the bank and they then communicated with the college and paid them directly, I didn’t get the check to deposit anywhere then pay the school myself.

Now, as my daughter is going to school, she got a student loan, I would have footed the bill but she wants to go her own way, anyway, she, gets the check, in her name. Her classes were paid for or that is the fees were by and large ‘waived’ because she got financial aid…..and, she also got a Pell grant for 1200.

Wtf?

All of this "Free Money" floating around with no accountability.

It's like the Sub-prime lending debacle. They loan money to thousands of people that don't have any qualifications, then they get stiffed on the loan. A Pell grant is not a loan, I supposed, but student loans are going to be the cause of another economic meltdown.

Especially when kids come out of school owing $100K and can't get a job

 

[Zoom-boing]

We've never seen a dime, the school is paid directly the loan/grant monies. Good, one less thing for me to deal with.

Now that the 'middleman' has been eliminated and over half of the 'saved' money is being used to increase loans and Pell grants . . . .tuition/housing/meals have increased. Again. One more year, one more year. And? She's decided she's had her fill of dorm life and will commute next year. That's a savings of $10,400 give or take.