I have high interest student loans...Need advice!?
Asked by voodewchileOk, so I've got about 4 private student loans through sallie mae totalling nearly $20,000, and a few federal loans totalling around $10,000. Now I was a dumb college kid, and signed off 14.25% interest rates on 3 of private loans, and 1 at 11.25%. Over the past year alone I've acrued $1,300 is interest on the private loans, but the federal loans are subsidized, so no interest on them. I have a few questions: 1)I'm still in school, so is the interest I accrue tax deductible while I'm in school? 2)When it comes time to consolidate, should I consolidate the private loans and federal loans together? 3)Is there any possible way to lower the interest rates on these private loans? Basically I'm looking for advice on what would be the smartest thing to do. These loans are not in repayment yet, but I'd like to get things square before I owe a TON in interest. If I'm screwed just tell me.
Favorite Answer
Answered by mickiinpodunk
Sigh, you may be *screwed* on the Sallie Mae loans, unless Sallie May will renegotiate them with you for a better interest rate, since they apparently are alternative loans. You cannot consolidate alternative and federal loans together. That said, most lenders would rather work with you so that you don't default on the loans. You may be able to roll these over into a new loan with a lower interest rate (rates are higher now than they were a few years ago, but even the alternatives have fairly attractive rates right now, certainly less than what you are paying now), so call Sallie Mae and ask to talk to a customer representative or their default prevention unit. Then ask your federal lender about income contingent repayments so you can structure that debt appropriately, too. Next I would hustle myself to a reputable credit counseling service and start looking at a program where getting out of this debt is paramount without incurring new debt, i.e. credit cards, new cars, etc. It sounds like you've woken up and smelled the coffee in time to prevent a major fiscal tragedy, though. Just take appropriate actions.
Sigh, you may be *screwed* on the Sallie Mae loans, unless Sallie May will renegotiate them with you for a better interest rate, since they apparently are alternative loans. You cannot consolidate alternative and federal loans together. That said, most lenders would rather work with you so that you don't default on the loans. You may be able to roll these over into a new loan with a lower interest rate (rates are higher now than they were a few years ago, but even the alternatives have fairly attractive rates right now, certainly less than what you are paying now), so call Sallie Mae and ask to talk to a customer representative or their default prevention unit. Then ask your federal lender about income contingent repayments so you can structure that debt appropriately, too. Next I would hustle myself to a reputable credit counseling service and start looking at a program where getting out of this debt is paramount without incurring new debt, i.e. credit cards, new cars, etc. It sounds like you've woken up and smelled the coffee in time to prevent a major fiscal tragedy, though. Just take appropriate actions.
