Private Student Loans is a Bad Idea?
Apparently something has gone wrong, and my financial advisers told me that I need to take out a private loan for college. I have heard so much stuff about private loans, but I still don’t know if it is a good idea or not. Wells Fargo constantly gets a bad wrap, so I think I’ll stay away from that, but should I stay away from a private loan all together??? If so, what should I do?????
A private student loans would need a cosigner, unless you are independent and have a good, established credit record. Its hard to advise without knowing your exact situation- in general, federal student loans are considered the safest route. This is because they have flexible repayment plans, hardship forbearances, deferments and even rehabilitation for those who default. Private loans are much more rigid.
In addition, most have variable rates, so you won’t be certain what you will end up paying. Before getting a private loan, weigh what your education is worth. Could you get an equivalent education for less money? What are your prospects for job placement after graduation? What is the average starting income in your field? What exactly will you be spending the next 10-30 years paying for? If you decide to get a private loan and you are creditworthy (or have a cosigner who is) look at credit unions. Right now, they have better rates and benefits than the big lenders.
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