How do loans work?

[helprosie]

Do you take out a loan year after year or take out one huge loan for all four years of dental school?

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[beingaunicorn]

You take loans out year by year.

 

[helprosie]

Whats the average interest rate? I'm trying to look up rate from the government but can find any.

 

[frozenicecreamDMD]

Whats the average interest rate? I'm trying to look up rate from the government but can find any.

you look it up on the school's fin aid, grad plus is at 7.2% now (thank god it is down from 7.9%) and perkin loans is at 6.2%) both are unsubsidized (accumulate interest right when you take it out.

 

[Soleus715]

you look it up on the school's fin aid, grad plus is at 7.2% now (thank god it is down from 7.9%) and perkin loans is at 6.2%) both are unsubsidized (accumulate interest right when you take it out.

https://studentaid.ed.gov/sa/about/announcements/interest-rate

Better rates for this upcoming school year. ... but who knows what will happen for next 3 years though

 

[Advance]

https://studentaid.ed.gov/sa/about/announcements/interest-rate

Better rates for this upcoming school year. ... but who knows what will happen for next 3 years though

 

[frozenicecreamDMD]

https://studentaid.ed.gov/sa/about/announcements/interest-rate

Better rates for this upcoming school year. ... but who knows what will happen for next 3 years though

WOWWWWW, THIS IS SUCH A GOOD NEWS, THANK YOU SOLEUS.

well, tbh, as the economy gets better and recovers, interest rate should go down. interest rates go up in time of chaos and economic recession.
I bet next 3 years interest rates continue to go down, hopefully.

I think this is possible. But the whole subsidized federal loan for dental education is nearly impossible but I am good with lower interest

 

[helprosie]

Thank you again for the help!

 

[MahiMahi]

WOWWWWW, THIS IS SUCH A GOOD NEWS, THANK YOU SOLEUS.

well, tbh, as the economy gets better and recovers, interest rate should go down. interest rates go up in time of chaos and economic recession.
I bet next 3 years interest rates continue to go down, hopefully.

I think this is possible. But the whole subsidized federal loan for dental education is nearly impossible but I am good with lower interest

Actually it's usually the other way around - interest rates in general "should" be going up over the next few years, barring another economic catastrophe.

However, federal student loan interest rates are set by congress, who may change it year-to-year for the new loans taken out each year. They're currently set to the yield for a 10-year treasury note, plus a little extra tacked on.

OP - I suggest taking a look at the official federal student loan site (https://studentaid.ed.gov/sa/types/loans) - it has a wealth of information on the subject.

 

[wildzodiac]

You can either apply yearly for federal loans through FAFSA or go the privitized route. Try sleeping around and you might land a sugar momma/daddy.

Interest rates vary from 7.21% to 5% depending on the loan. Most start accruing interest from the time of disbersement. The Health Professions loan is 5% interest but doesn't accrue interest until after you graduate. It is capped at around $10,000.

If you're broke and go the FAFSA route, they will make sure you get the money you need to go to school. You can then choose how much/little you need to take out. It's super simple.

 

[whaleofatale]

https://studentaid.ed.gov/sa/about/announcements/interest-rate

Better rates for this upcoming school year. ... but who knows what will happen for next 3 years though

These rates are for 15-16 and expire on June 30, 2016. Next year's rates are generally expected to be higher.

 

[Soleus715]

These rates are for 15-16 and expire on June 30, 2016. Next year's rates are generally expected to be higher.

Yeah I feel that way as well..

It went down couple years in a row, it's unlikely that the trend will continue for too long,
plus tuition will keep going up year after year. So gotta be realistic with how happy we get lol

 

[Confused1617]

Is there an origination fee for fafsa loans?

 

[Soleus715]

Is there an origination fee for fafsa loans?

Yes. I copypasted my comment from another thread for reference

It's calculated each year based on the market rate.

For this year, the Unsub. loan is at 5.84% with a 1.068% origin. fee.
The Grad PLUS loan is at 6.84% with a 4.272% origin. fee.

Both loans accrue interest from the date of disbursement.
For Unsub. loans, there is a maximum aggregate loan amount of $224,000 (including all sub/unsub loans from undergrad).
You cannot borrow more than this amount in unsub loans, which means you'll have to take out more in Grad PLUS loans.

Credit check is required for the Grad PLUS loan.
Payment is required 6 months after graduation.

Source:
https://studentaid.ed.gov/sa/types/loans/subsidized-unsubsidized
https://studentaid.ed.gov/sa/types/loans/plus

 

[nonociceptors]

 

[Soleus715]

LOL WAT

 

[Advance]

LOL WAT

Well damn.

 

[Justdontblink]

Actually it's usually the other way around - interest rates in general "should" be going up over the next few years, barring another economic catastrophe.

However, federal student loan interest rates are set by congress, who may change it year-to-year for the new loans taken out each year. They're currently set to the yield for a 10-year treasury note, plus a little extra tacked on.

OP - I suggest taking a look at the official federal student loan site (https://studentaid.ed.gov/sa/types/loans) - it has a wealth of information on the subject.

I don't think that it will be a complete catastrophe like in 2008 but we should be entering a recession in the next few months/years