Monday, July 16, 2007
Loan Management
Debt burden can be lowered before graduation despite most loans going into deferment while the students are in school. Daniel Brown, 23, a first year student at Washington University Law School in St. Louis, graduated debt-free last year with a BA in English due to an all-inclusive merit scholarship. However he has only $10,000 in scholarship money for law school. He intends to finance the remaining $28,460 tuition with $15,000 in student loans and contribution from parents. $8000 of the loans are subsidized but he has to pay on the interest of the remaining unsubsidized amount while in school or defer and accumulate interest until repayment.
A part of the loan money will go into living expenses like car insurance and he plans to live at home to save money. After graduation he expects a debt of $45,000. Currently he pays interest on his student loans and intends to get well-paying summer internships to reduce the amount to be borrowed.
Lay Lock's advice is to pay interest while still in school to avoid the amount accruing. For a small windfall $2,500, one should pay $200-300 on student loans.
# posted by karthika : 2:47 AM
Subscribe to Posts [Atom]