Thursday, October 11, 2007

Sallie Mae News

Sallie Mae has posted a 13% increase in student loan originations this quarter compared to the 3rd quarter a year ago.

This is the way CEO C.E. Andrews puts it:
“Thanks to our industry-leading brand, our scale and efficiencies, and our focus on students and families, we successfully faced a number of challenges this quarter. We have a solid track record of growing our ‘core earnings’ through various political, interest rate and economic environments, and the fundamentals of our business point to a bright future for our company.”

How nice. All this new business with all of its origination fees should help comfort them in swallowing the $344 million loss they have this quarter due to stock market declines and defending against company acquisition.

Tuesday, October 09, 2007

Average Student Debt

The 2006 Average Student Debt report is out and the winners are ...

The top 3 best states: Hawaii ($11,758), Utah ($12,807), and Kentucky ($15,406).

The bottom 3 worst: District of Columbia ($27,757), New Hampshire ($24,800), and Vermont ($24,839). This makes sense because the New England area has the highest tuition rates as well.

The national "average" yearly tuition in 2006 was right at $10,000. That's $40K for an "average" college education. Have your financial plan in order before approaching Sallie Mae. I know in my last post I said student loans "can" be considered good debt.

Still, having a realistic financial plan to pay off your student loan may be more important than getting a good enough SAT score to get into college in the first place. A wrong choice at such a tender young age entering school can financially ruin you for life.

There are many horror stories out there of people being in $100K+ debt because they under estimated the long term cost of their loans.

Friday, October 05, 2007

College loans are considered good debt ?

The Etownian Online has things that "may" ease your mind as you take the student debt plunge.

Student debt is actually considered good debt if you're faithful in making regular payments on it.

1) Lenders are more likely to grant you mortgage and car loans if you show them you are being responsible with your student debt.

2) Some companies you work for will help pay off your loan as long as you stay with that company for a certain number of years.

3) Other volunteer groups such as The Peace Corps will reimburse you too.

4) If grad school is your next stop, you might be able to get some student loan compensation by becoming a TA for a research fellowship.

There's a common theme in the last three items. If you're willing to donate some time and effort, you might see your loans disappear faster.

Preston Orr

Preston Orr writes:
I have been out of college for 5 years now. I have been paying this $20,000 loan with an interest rate that started at 8% and is now at 12.5%. I bought a townhouse, hoping that I will build enough equity to pay off my loan. I cannot consolidate this loan. What is wrong with this country?

... I know this is a brief note but does anyone else want to vent their frustration?