What is the process like and how old are you when you make the decision to take on this loan?
Do you sit down with the principal of whatever college and he just says, yeah basically you have to take on this massive debt so just sign here please.
Or do you sit down with bankers? What actually happens? The more details the better 🙂
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Federal loans you go through a federal government form that is pretty easy to fill out. It handles pell grants as well.
You can also go through the private loan systems if you need additional money outside of grants, scholarships, and federally subsidized loans.
Most student loans aren’t “massive”. And what a degree can bring you in terms of a salary compared to a high school education the tuition can easily be justified, particularly for in-state public universities.
You generally aren’t taking out a single loan; you take out loans each year. For federal loans, there is an online application that you fill out that goes through the Department of Education and is sent to your school. Your school offers a financial aid package that will contain some combination of scholarships, grants, and loans. You can accept all or some portion of it. The process repeats every year until you graduate.
Betsy Devos personally came to my house back in 2018 and threatened me until I agreed to sign /s
In reality, when you get federal loans you apply for fafsa. You give your financial information, and your parent’s financial information and if you qualify/choose to take the loans, you and your parents sign for them.
You repeat that process until you’re done with college.
It’s all electronic now. Just fill out a few forms and complete a few minutes of text based loan counseling and you’re good to go.
First you submit your application for free federal student aid. Then you apply for a federally backed student loan for the balance of your tuition – this is usually just a long online application with maybe some docusign steps. If the balance of your tuition is more than the max you can borrow federally, you can either borrow privately (more applications, higher interest, and the loans will never go away even if you go bankrupt), or your parents can apply for a supplemental federal loan, sometimes called a “Parent-Plus” loan, where they are the borrower.
Repeat this process every year you’re in school.
When you go to the college they usually have a financial services office that you go through. They use fun euphemisms to take your mind off the fact that you are signing a contract to replay giant loan, and that you have no recourse once you’ve signed.
How it worked for me:
-Be 23. (about five years late, most new college students are 18-19.)
-Fill out a financial aid application. Get denied for a lot of the better stuff.
-Apply for a student loan, through the financial aid department of your school. (You could get a private loan from a bank, but that’s asking for even more trouble- Federal student loans, for example, don’t demand collateral, so you’re never going to lose your parents’ house by defaulting on your student loans).
-When the disbursement comes, it will arrive at your college (not put in the mail to you directly). What you have to do is endorse (ie, countersign) the check in the presence of a college official witnessing it, and then walk down the hall with more money than you have ever held in your life to give it to someone at the (legally separate) Bursar’s office, who accept the money.
If you’re lucky, that was a federal loan, and now we’re talking about forgiving those. If it was anything else, tough. This process repeats every school year.
-Leave because of a family emergency, never getting the Bachelor’s you were there for.
-Pay it until 2020. It’s 1995.
I fill out a FAFSA form every year with information on my income and other personal info, as well as what school I’m going to be attending, that information is used to determine what amount I’m going to get paid for through grants, through subsidized loans, and through unsubsidized loans.
The loan company then sends the money to the school at the beginning of each semester. I have to fill one out each year I’m in school. The first time took a little while if I remember correctly, maybe 45 minutes, but in subsequent years it takes less than 10.
It can be predatory as fuck, I went through the process a little bit later than most because I went to community college and then transferred, so I filled out the online application when I was 20.
I was kind of young and stupid and just ran through it quickly, luckily I didn’t end up borrowing a lot compared to other people and I came out with a computer science degree which got me a pretty good job lined up before I even graduated. The same is absolutely not true for many others. I got lucky.
I was the first in my family to go to college so I had to do it all on my own, no guidance at all which is a recipe for disaster for many young people. Taking on debt that can never go away. You can’t declare bankruptcy to absolve the debt because the loan companies lobbied our wonderful government to make it so that the debt follows you to the grave.
For-profit schools run a massive racket to extract as much money as possible from young and clueless students hoping to pursue a career. These loans can set you back decades, from a financial standpoint. You fuck up enough and you’ll only be able to pay the interest on these loans for the rest of your life. The Biden administration forgave some of these loans I believe, against schools like ITT Tech.
If it’s like most of the people in my circle (I’ll separate the people that want debt forgiveness and the ones that don’t)
Want debt forgiveness.
Spend about an hour perusing what you want to go to school for (or basically what degrees do not have heavy math)
Then spend about 15 minutes researching the major you chose.
Then go through the loan application process. Ignore the part about compounding interest, and repayment options. Either go to school for a few semesters and change majors or not finish because of reasons. And never go back after those reasons have been resolved.
Spend 20 years working at Target bitching about the greed of the government and the “organized extortion” of the loan process (make sure to never except responsibility for your own actions or inactions)
People that don’t want debt forgiveness.
Do any and all research involved in grants, scholarships, sponsorships from businesses, etc.
Spend (spent) the last five years of their lives researching the field, or related fields they want to go into.
Call HR departments or go to job fairs researching the salaries and expected growth of their fields.
Go to school and finish.
If reasons happen that prevent them from finishing, they go back after the reasons are resolved.
I know this a little assholeish here. But this has been my experience.