If Ohio wants to keep or grow its tax base, it should start looking at expanding student loan forgiveness programs. While it is true that the Ohio Board of Regents oversees a couple of programs for teachers and nurses, the state can do better by offering loan forgiveness to graduates who have higher debt. (and hopefully are also higher earners because of their better education) Graduates of engineering schools would be one group to target.
It is very difficult to "do your homework" when looking for a private loan for college. Typically, the rates advertised are only the ones that are available to the top 1% of borrowers with the best credit rating. Shopping around can actually result in lowering your credit score, as each application costs you 5 points on your score. Unlike auto loans or home mortgages, credit reporting agencies do not give you a window where you are not penalized.
Many students and parents have been shocked to find that they are being turned down for private college loans this year, even though they have been approved in the past. Lenders have tightened their credit requirements and it is no longer a borrowers market.
If applicants are confident that their credit scores will be acceptable (over 750) to a private lender, what they can do is look for other benefits that can make a loan more attractive, such as rate reductions for auto-debit, cosigner release after a minimum of on-time payments, forbearance terms, or flexible, extended payment plans.
Although consolidation and refinancing are difficult this year, hopefully by the time the student graduates the credit crunch will have eased. These options not only lower payments, but improve the borrower's credit rating as the original loans are paid off.
The thing that students must be counseled on is that default is not an option. Simply not paying your student loans will ruin your life, especially since Congress has decreed that private college loans are just as sacrosanct as the federal ones.
Posted on June 17 at 9:36 a.m.
If Ohio wants to keep or grow its tax base, it should start looking at expanding student loan forgiveness programs. While it is true that the Ohio Board of Regents oversees a couple of programs for teachers and nurses, the state can do better by offering loan forgiveness to graduates who have higher debt. (and hopefully are also higher earners because of their better education) Graduates of engineering schools would be one group to target.
Posted on August 13 at 8:21 a.m.
It is very difficult to "do your homework" when looking for a private loan for college. Typically, the rates advertised are only the ones that are available to the top 1% of borrowers with the best credit rating. Shopping around can actually result in lowering your credit score, as each application costs you 5 points on your score. Unlike auto loans or home mortgages, credit reporting agencies do not give you a window where you are not penalized.
Many students and parents have been shocked to find that they are being turned down for private college loans this year, even though they have been approved in the past. Lenders have tightened their credit requirements and it is no longer a borrowers market.
If applicants are confident that their credit scores will be acceptable (over 750) to a private lender, what they can do is look for other benefits that can make a loan more attractive, such as rate reductions for auto-debit, cosigner release after a minimum of on-time payments, forbearance terms, or flexible, extended payment plans.
Although consolidation and refinancing are difficult this year, hopefully by the time the student graduates the credit crunch will have eased. These options not only lower payments, but improve the borrower's credit rating as the original loans are paid off.
The thing that students must be counseled on is that default is not an option. Simply not paying your student loans will ruin your life, especially since Congress has decreed that private college loans are just as sacrosanct as the federal ones.
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