Saving on Student Loans

Ken Dolan: Hey, wallet poppers how are you? Daria Dolan: Hi, poppers. Ken Dolan: We’re the Dolans. Ken and Daria Dolan at your service, don’t forget to keep sending your questions to wallet pop because we are here to answer your questions especially during difficult times like. Daria Dolan: You have a hole in your hair. Ken Dolan: It’s better than a hole in my head. Thank you, Daria. Daria Dolan: Well, maybe that is the hole in your head. Ken Dolan: Can we do this please? Daria Dolan: Okay. Go Ahead. Ken Dolan: Alright, go ahead. Now, Marilyn emails us here, wallet popper. She’s a popper and she says “Hi, Daria. Hi, Ken. I have two kids in college. Will the current credit crisis” which I just talked about. “Will it make it harder to get more money” I think she have a little money so far because the kids just started school. “Is it going to make it harder for me to get money for college.” Well, let me give you the good news. The current credit crisis as for car loans, from mortgages even people with good credit can’t get even one of them sometimes, but not so much for a federal education loans. Not so much. And that’s good news. Daria Dolan: And this email that came from a dear friend of ours, Kal Chaney who is a financial consultant for college funding and author of the book “How to Pay for College without going Broke?” The latest edition of which is just out. So anybody with kids in college should pick up a copy of this. Ken Dolan: The book is called “How to Pay for College without going Broke?” I want to do this quickly. You can go to Amazon.com. It’s by Kal Chaneyand go to Amazon.com and get a copy of that. “How to Pay for College without going Broke” I’ll read this. This just came in. What does it say? Daria Dolan: It’s a little too complicated to do it but this is only good for 2008 to 2009 the current federal legislation unless they extend it. Boy, why don’t they just put a stake in something once in a while. And it allows most undergraduate dependent and independent students to borrow an additional two thousand dollars in the form of unsubsidized Federal Stafford loan. But, I do want to go, oh, go ahead. Ken Dolan: No, I just am going to say. Yeah, I want to take that right out. The new legislation has made it easy for parents to pass the credit test for that federal plus loan, federal plus loan which is different than the Stafford. So there’s some good news there. You still have to pay it back. But there is some good news. What are you going to say? Daria Dolan: Here is my big concern and I think parents with kids that are in college or about to go into college who really can’t afford between the kids and their own savings to do this without taking my massive amounts of debt seriously to reconsider college strategy because look at the situation we’re in economically and what happens to the seniors who graduate this year. If they come in to a world in which they need—they’re in this economy right now in this country that doesn’t expect to see unemployment going higher. They’re going to enter in to a very bad time economically with student loans and possibly no jobs. It’s a very serious time for care parents of college aged kids to start contemplating other alternatives even if you have to send them to a junior college for the first couple of year. Ken Dolan: So start saving. Daria Dolan: Nobody knows what the four years look like. It’s where the degree emanates from that’s the final arbiter. Ken Dolan: I do want to say also, that’s a good point Daria, under the federal plus loan, the parent can borrow up to the full cost of attendance and also can request that the money not be paid back until after graduation, number one. After the child leaves school without graduating or becomes a student less than half time. And the bigger question here now, that’s college. The bigger question here is a bigger credit question and that is, what do you do if the credit is bad? And if you can’t borrow money even the money’s tighter. Now is a good time to start rebuilding credit when it’s tough to get credit. Start paying your bills on time. Start really building up that credit report because when it becomes easier to borrow money with better credit, you’ll be in better position. Start now. “How to Pay for College without going Broke” Amazon.com by Kal Chaney. It looks pretty good. Daria Dolan: C-H-A-N-E-Y. Daria Dolan: Thanks for the question, Marilyn. Ken Dolan: Good one, Marilyn. Thanks.