2008 Woodie Awards
Students find limits of school loans in interest rates
Rachel Ciardi, Reporter
Issue date: 2/28/08 Section: News
College grads face a lower chance of unemployment than high school graduates, and earn an average $1.5 million more during their careers, according to the Sallie Mae Web site.
Before getting all that green, however, students have to deal with being in the red.
Upon graduation, many Youngstown State University students will be stuck paying off student loan debt.
Freshman Shereen Ramahi said student loans mostly cover her tuition. Although her parents plan to help repay the loans, the debt is never far from her thoughts.
"I'm not going to lie; it's always in the back of my head," Ramahi said.
James Stranger, an associate director in YSU's Financial Aid Office, said current interest rates are 6.8 percent for Stafford loans and 8.5 percent for PLUS loans.
While student Stafford loans have a fixed rate of 6.8 percent, loans might not cover all of the financial needs of full-time students. Like the interest rate, the amount a student can borrow is fixed.
First-year freshmen, who are required to file with their parents, receive a maximum of $3,500 per academic year, according to YSU's financial aid Web site. Sophomores can borrow $4,500, and juniors and seniors can borrow $5,500.
Once leaving the safe 6.8 percent bracket of the government, students will find that private alternative student loans don't offer the same fixed, low interest. According to the Citizens Bank Web site, student loan rates can range from 8.49 to 13.91 percent.
While interest rates are a constant issue for junior Antje Mosley, she still feels fortunate.
"I don't like the fact that the interest is so high, but without loans I wouldn't be here," Mosley said.
That is the case for many students who question their options after graduation.
Stranger said students most often call with questions concerning payment consolidation and deferment. Loan repayment at YSU is handled through Great Lakes Financial, and repayment begins six months after the student graduates.
Student loans are not covered by bankruptcy that may be declared by students later on, Stranger said.
Avoiding taking out more money in loans than needed and borrowing with a co-signer in order to get lower interest rates are suggestions from financial institutions like Sallie Mae, Bank of America and Charter One.
Another option is to make payments on interest while still in school. Charter One offers a discount for those who make automated payments. The YSU Financial Aid Web site provides a loan repayment calculator.
According to the site, Ohio resident students pay more than $6,800 per academic year to attend 12 to 16 hours of classes at YSU. With room and board, the cost is more than $13,900. Neither figure includes the $50 lab fees attached to some classes.
Before getting all that green, however, students have to deal with being in the red.
Upon graduation, many Youngstown State University students will be stuck paying off student loan debt.
Freshman Shereen Ramahi said student loans mostly cover her tuition. Although her parents plan to help repay the loans, the debt is never far from her thoughts.
"I'm not going to lie; it's always in the back of my head," Ramahi said.
James Stranger, an associate director in YSU's Financial Aid Office, said current interest rates are 6.8 percent for Stafford loans and 8.5 percent for PLUS loans.
While student Stafford loans have a fixed rate of 6.8 percent, loans might not cover all of the financial needs of full-time students. Like the interest rate, the amount a student can borrow is fixed.
First-year freshmen, who are required to file with their parents, receive a maximum of $3,500 per academic year, according to YSU's financial aid Web site. Sophomores can borrow $4,500, and juniors and seniors can borrow $5,500.
Once leaving the safe 6.8 percent bracket of the government, students will find that private alternative student loans don't offer the same fixed, low interest. According to the Citizens Bank Web site, student loan rates can range from 8.49 to 13.91 percent.
While interest rates are a constant issue for junior Antje Mosley, she still feels fortunate.
"I don't like the fact that the interest is so high, but without loans I wouldn't be here," Mosley said.
That is the case for many students who question their options after graduation.
Stranger said students most often call with questions concerning payment consolidation and deferment. Loan repayment at YSU is handled through Great Lakes Financial, and repayment begins six months after the student graduates.
Student loans are not covered by bankruptcy that may be declared by students later on, Stranger said.
Avoiding taking out more money in loans than needed and borrowing with a co-signer in order to get lower interest rates are suggestions from financial institutions like Sallie Mae, Bank of America and Charter One.
Another option is to make payments on interest while still in school. Charter One offers a discount for those who make automated payments. The YSU Financial Aid Web site provides a loan repayment calculator.
According to the site, Ohio resident students pay more than $6,800 per academic year to attend 12 to 16 hours of classes at YSU. With room and board, the cost is more than $13,900. Neither figure includes the $50 lab fees attached to some classes.
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