Frustrated!!

lolasmit · December 2013

We finally paid off two of my credit cards with high interest. After having paid them off we are financially stable, and can pay of the rest of our debt. Fantastic! But then we have to pay a $1500 for my school for my next semester. It sucks because due to that we have to use our credit cards again - the ones with the high interest...My school only accepts Mastercards.

Just wanted to vent . . .but at least school is a "good" debt.

smerka · December 2013

Sorry you're frustrated. Just so you know you can claim the interest on your credit cards you pay as student loan interest on your taxes. Just make sure that the tuition is the only thing on the card. http://www.irs.gov/publications/p970/ch04.html

hoffse · December 2013

OP have you soughgt other forms of loans? Generally we say student loan debt is "good debt" because the interest rates are low (like 4-8%) and your earning capacity increases more than that with a degree.

Sisugal · December 2013

Can you get a part time job (1st or second job) and pay that off? Cut your other spending? Ask for gift cards or cash contributions to your college expenses in stead of Christmas gifts?

vlagrl29 · December 2013

i second students loans. mine are at 2.85 interest.

lolasmit · December 2013

I have accrued 3 thousand dollars on interest since 2009. They are between 4-6%.

Unfortunately, I am not able to get a second job with school and already working full time plus being pregnant.

We did ask for cash for Christmas though, so we hope that works.

Oh, I didn't know I could claim the interest on my taxes. Thanks for the link!!

What's killing us is that we have to pay cash $1,000 a month until May. I used to get financial aid, but now my financial aid only gave me $1,000 grant which is great.

Xstatic3333 · December 2013

OP, do you mean that you already have student loans and don't want to take out more? I'd still take more over a CC if you can, just due to the flexibility of paying back federal loans. I've had $3000 in interest build on my loans, too. It's a drag, but better than CC debt by far.

If you charge the $1500 now can you pay cash for the rest of your payments? If you can't get a federal loan, have several cards, and just need to use the highest interest card because of your school's requirements, I'd pay and then transfer the balance to one of your lower interest cards. If you have a good payment history, you could even call and ask if they are offering any special balance transfer promotions.

lolasmit · December 2013

Hmm, I didn't think about transferring the balance. That is actually a great idea!!!

Well, I am 22 and I can't get a loan without a co-signer because my credit history is far too short even though my credit score is 779. Unfortunately, I don't know anyone that could co-sign with me.

By paying the 1500 a month with the credit card by the end of the month I can pay it back with what I make from working. But the payments for school don't coincide with when I get paid, unfortunately.

Ducktale · December 2013

Are these federal loans? With government loans you should not need a cosigner. If you qualify for a goverment school grant you should also qualify for school lans, which i would think is far better than charging it on a card you'll have to carry a balance on. So much of this is confusing to me. Not even touching the "we asked for money for Christmas " thing.

lolasmit · December 2013

Ducktale said:

Are these federal loans? With government loans you should not need a cosigner. If you qualify for a goverment school grant you should also qualify for school lans, which i would think is far better than charging it on a card you'll have to carry a balance on. So much of this is confusing to me. Not even touching the "we asked for money for Christmas " thing.

DH's mother always gives us money for Christmas and any holidays. She always tries to help us out financially, so she usually helps with a set amount of what we need with school. If we ask her for anything other than money she refuses because she knows school is what we need help with.

Yeah, federal loans. The loans were under my parents with the FAFSA since I am not 24. My school considers me a dependent until I am 24 otherwise according to them I am still a dependent even if I live somewhere else. And since I just got married I can't reapply for the FAFSA as married otherwise that would have solved the issues.

Ducktale · December 2013

Okay, so they are taking your parents finances into consideration with FAFSA and therefore said you/your parents are over the income for student loans, yet you qualified for a grant? Thats where you're losing me. And so this would not have anything to do with not having a long enough credit history, since that does not count against you for federal student loans.

Xstatic3333 · December 2013

Hmmm, I do have some undergraduate friends who needed cosignors, but they had NO history. Is there any way you could make an appointment with your financial aid office and figure all this out? Although, if you can pay off the $1500 monthly than that's not a problem at all. You might even get lots of points.

Also, if your credit score is 779 you must have a decent history. I just hit that number this week after 9 years with no adverse marks except occasionally having more debt utilization than that 30% sweet spot.

Ducktale · December 2013

Cosigners are needed for bad credit, but length of credit does not count against you (or no 18 years olds could get one without a cosigner). Also this is for federal loans, does not apply for private loans. Here's the FAQ page, see under the "credit check" tab: https://studentloans.gov/myDirectLoan/faqs.action

lolasmit · December 2013

Ducktale said:

Okay, so they are taking your parents finances into consideration with FAFSA and therefore said you/your parents are over the income for student loans, yet you qualified for a grant? Thats where you're losing me. And so this would not have anything to do with not having a long enough credit history, since that does not count against you for federal student loans.

Oh, I see what you are using. FAFSA is only using my parent's income towards my loans. The reason why I was able to receive a grant is because my parents income is very low, and my mother is disabled.

I applied on my own for sally mae loans and when I called them to inquire about my application they said that I needed a co-signer. When I asked why they stated that my personal credit history was too short for them to offer me a loan.

lolasmit · December 2013

They told me that if I do it on my own I need a co-signer, but if I do it with my parents I can't get any more loans due to my parents credit score. . perhaps I should contact them again.

I checked my credit score and report as well. All my cards are in good standing, and my score came out a 779. I've only had credit history since I was 18. Perhaps that's what they mean with a "short" credit history? They say its not long enough for me to have a loan on my own.

lolasmit · December 2013

One thing I forgot is that they don't allow me to apply for loans without filling out the FAFSA which in my school we only do once a year. So, even if I wanted to I can't apply for government loans from FAFSA, and when I tried private ones with sally mae, etc. The above issues occurred.

Xstatic3333 · December 2013

So the Sally Mae loan that needed a cosignor would have been a private loan. Where I'm confused is that you should be able to take out a Stafford loan, which is federal, through your school if your parents' income is low enough for you to receive grants. You shouldn't need a cosignor with your good credit history. I didn't for mine, with slightly lower credit than you and very low income at the time.

I'm wondering if your school isn't giving you good information. I would definitely try to make an appointment to hammer it all out. It's almost like they want you to use your CC so they get the money faster (the fed loan system works by alumni repaying their loans for money to be available to current students-gross oversimplification).

lolasmit · December 2013

Xstatic3333 said:

So the Sally Mae loan that needed a cosignor would have been a private loan. Where I'm confused is that you should be able to take out a Stafford loan, which is federal, through your school if your parents' income is low enough for you to receive grants. You shouldn't need a cosignor with your good credit history. I didn't for mine, with slightly lower credit than you and very low income at the time. I'm wondering if your school isn't giving you good information. I would definitely try to make an appointment to hammer it all out. It's almost like they want you to use your CC so they get the money faster (the fed loan system works by alumni repaying their loans for money to be available to current students-gross oversimplification).

Oh. When i try to apply on the website it tells me to fill out the FAFSA. . which we only do once a year. Is that what you mean?

Xstatic3333 · December 2013

Hmmm, but if you did fill it out they should still have your information on file. I mean this may be a moot point since you can pay off the CC bills monthly anyway, but if you need a federal loan in the future I wouldn't hesitate to go down in person, ask questions, and find out why you weren't offered a Stafford loan. Filling out the FAFSA yearly is standard, but they should give you an aid award to cover the full academic year (including loans). In your case filling it out again might actually hurt you if your H's income is higher than your parents'.

Ducktale · December 2013

Ah, okay I'm seeing what you're saying, thanks for the explanation. I hadn't heard about your parents credit scores adversely affecting getting a Stafford loan, I'd double check that if I were you. Maybe you can use the information at the above link to claim extenuating circumstances? Can you talk to your school's financial aid department? Sally Mae is private and they can do whatever they want in regards to your credit, though I would steer clear of Sallie Mae if possible anyway. This sounds like such a headache, sorry OP!

hoffse · December 2013

It's been a few years since I filled this out, but as I recall you can elect to NOT be a dependent on the FAFSA, regardless of your age. I think this changed under Obama. I remember one year I had to include my parents' income and the next year I didn't as an undergraduate.

Definitely talk to your school's financial aid office, OP.

Ducktale · December 2013

hoffse said:

It's been a few years since I filled this out, but as I recall you can elect to NOT be a dependent on the FAFSA, regardless of your age. I think this changed under Obama. I remember one year I had to include my parents' income and the next year I didn't as an undergraduate.

Definitely talk to your school's financial aid office, OP.

Really? That would ave been great. My parents didn't pay a dime towards my education so I was always a little miffed they used their income to come up with my financial aid package.

brij2006 · December 2013

Ducktale said:

hoffse said:

It's been a few years since I filled this out, but as I recall you can elect to NOT be a dependent on the FAFSA, regardless of your age. I think this changed under Obama. I remember one year I had to include my parents' income and the next year I didn't as an undergraduate.

Definitely talk to your school's financial aid office, OP.

Really? That would ave been great. My parents didn't pay a dime towards my education so I was always a little miffed they used their income to come up with my financial aid package.

Dang. That would've been awesome 5+ years ago. My parents didn't pay for my schooling either, and I could never get any assistance because they always made too much.

vlagrl29 · December 2013

It could have changed since I was in school. The last year I applied for loans was 2003, but I didn't need a cosigner and I had no credit.

Wulfgar · December 2013

If you are married, then you don't need your parents income on the FAFSA either. I would talk to one of the financial councilors at your school and they can help you out with what to do. I think you being pregnant should put you into a different category even if you are not married.

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