May 26, 2014
Thank you for posting your advice here, it’s most valuable and helpful.
As a parent I took om Parent’s plus loans to allow my son a higher education. I am currently paying around 8%, which is outrageous by any measure.
while I understand the Federal [potential] benefits, they come with heavy shackles (i.e. higher interest rates). And by the way, these loans cannot be discharged in a bankruptcy either (not that I plan to anyway).
I simply weigh the long run interest and total cost of the loans I pay back to the government vs the possibility to pay off the whole amount much sooner and with lower int rates.
> Do you know if SoFi requires any collateral to qualify one for the loans?
> DO you think it will not be a good idea to make this move?
And perhaps this is for another topic, but I’ve not heard any discussion on providing any relief or cutting the interest rates on this type of loans. I even wrote to our representative, but they don’t seem to care about this at all. I wonder f there is any forum discussion on this, and if there is any petition I can sign and voice my concern.
Would appreciated anyone with similar experience to weigh in, provide advice or tell your stories of how you got out of this blunder
May 3, 2014
To answer your first question, no collateral should be required for any student loan. As you noted, student loans cannot be discharged in a bankruptcy. Therefore, ANY student loan that required any sort of collateral should not be taken out. SoFi, and any other legitimate student loan lender will not require this collateral.
I typically suggest that people avoid making this particular move. I call it the Golden Rule of Consolidation, and have written an article on the subject (found here: https://studentloansherpa.com/…..olidation/ ). However, like any rule, their are exceptions and it sounds like you might be one of the exceptions. I can’t tell you whether or not it is a good idea for you and your family, but the decision comes down to one simple question. Are you absolutely certain that you will be able to make every payment as agreed? Federal loans are far more forgiving, but sometimes you do run into higher interest rates. If you are certain that you will be able to make your payments under any circumstance, this might be a good approach.
As for relief from the interest rates coming from congress, it does look like a long shot. However, Senator Warren did recently announce a plan that would help out situations like yours https://studentloansherpa.com/…..ate-loans/ Unfortunately, I don’t think it has much chance at becoming law. There are several facebook groups that focus on student loan advocacy that might be worth investigating if you are interested in taking a more active role in the student loan debate.