Student borrowers latest to feel credit crunch

[El Pinko]

http://www.signonsandiego.com/uniontrib/20080217/news_1b17marks.html


Student borrowers latest to feel credit crunch
GAIL MARKSJARVIS
February 17, 2008

If you want to borrow a lot of money for college, you are not going to like what the mortgage mess is doing to you.

The credit crunch, which started with a panic over people missing home loan payments several months ago, has spread like a disease, infecting a broad range of loans. Now it may poison opportunities for college students to obtain some loans and is adding painfully high interest costs to many.

So far federal student loans, or the low-interest college loans offered under government rules, are still plentiful. Students who get Stafford loans pay 6.8 percent interest, which is relatively low compared with other loans available for college.

But concerns developed last week because some lenders have decided to stop giving out student loans. The lenders made the decision because they had trouble borrowing money themselves. And they need to borrow money in order to lend money to students.

[Deja Q]

1. Well, if the colleges would stop raising fees...

[msongs]

2. wow. my student loans were at 2.5% and that was just a few yrs ago nt

[DBoon]

3. See what happens when you use private credit

as a substitute for social welfare programs

[InkAddict]

4. How many ex-homeowners, medically disabled, and military

have personal responsibility to repay Federal Student Loans?

Note: Death of the student borrower or older parent borrower (unless private loan and/or co-signed) results in loan forgiveness(?) If private and/or co-signed, responsibility falls to estate of the deceased and/or co-signees).

Ramifications during recession/depression?

[halobeam]

5. note: loan forgiveness is not always granted to a permanently disabled person.

Even when it's a Sallie Mae/ACS loan. I know this first hand. Screwed up, isn't it.