Richman

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I have 3 non-federal CitiAssist loans from Citibank and have been in repayment for about 5 years. These loans have a variable interest. Fortunately (and sadly) because of 9/11 my repayment interest was very low for many years and making payments was very easy. Now these loans are up at about 9.25% (for two loans) and 8.37%.

Any advice on:

A: Better rates
B: A fixed rate consolodation
C: ???
D: Suck it up and quit whining

I own a home with about 60K equity. My CitiAssist total principal is just under 30K.

I appreciate any comments or suggestions.

Richard
 

Lesley

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I have 3 non-federal CitiAssist loans from Citibank and have been in repayment for about 5 years. These loans have a variable interest. Fortunately (and sadly) because of 9/11 my repayment interest was very low for many years and making payments was very easy. Now these loans are up at about 9.25% (for two loans) and 8.37%.

Any advice on:

A: Better rates
B: A fixed rate consolodation
C: ???
D: Suck it up and quit whining

I own a home with about 60K equity. My CitiAssist total principal is just under 30K.

I appreciate any comments or suggestions.

Richard



You have equity in your home. I'm sure you've thought about a fixed interest, home equity loan, or do you have concerns about that option? The rates may not be a lot lower, but, if they're fixed, at least they won't go up. Right now the big debate is whether the Fed going to lower or raise interest rates in the near future, although I think this influences short term rates more than long term. Rates could come down a little bit, maybe more, but at least a fixed rate now, may give piece of mind. Not that it makes much difference, but I'm in the camp that thinks interest rates will be lowered, but who knows? I have a 50/50 chance of being right (or wrong)! If rates do go down, you could possibly refinance without much penalty. Maybe you could talk to a local bank and run some numbers. Good luck.
 

Richman

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I looked into using equity but with rates at about 7% I wasn't sure if that would be a good use of my equity. So it looks like I have two options then: 1- slightly lower fixed rate using equity or 2- hope that my current rates come down.

I really feel bad for any new grad that has to start a career with these ridiculous rates. Not a healthy way to start off.

Anyone using equity to help pay off student loans? It would be great to learn from your experience. Anyone have a good reason to believe rates will be coming down any time soon?

Rich
 
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iheartrain

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Ughh I feel ya

I have Citi private loans too and I think some of them are over 10% (all acquired in the last year when interest rates were high, I even have really good credit so it's frustrating). I wanted to ask if others knew of private loan companies with lower rates...or is it pretty much just always prime (which is high right now) plus 2% and up? Very frustrating!
 

bkpa2med

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I may be wrong, but isn't myrichuncle.com a private lender?
 

Lesley

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I looked into using equity but with rates at about 7% I wasn't sure if that would be a good use of my equity. So it looks like I have two options then: 1- slightly lower fixed rate using equity or 2- hope that my current rates come down.

I really feel bad for any new grad that has to start a career with these ridiculous rates. Not a healthy way to start off.

Anyone using equity to help pay off student loans? It would be great to learn from your experience. Anyone have a good reason to believe rates will be coming down any time soon?

Rich

I also feel badly about the higher rates that students are facing. There is little good in higher interest rates on student loans. The only thing possibly good that comes out of it is the determination to get the high interest loans paid off asap. That is exactly what we did in the 80's when some of our interest rates were around 15%+. Had the interest rate been lower, we could be still paying them off today.:D I think you may have time on your side. If interest rates go down, I would definitely consider a fixed rate, home equity loan. Mortgage rates are down from last year already. There is definitely inflation, you or anyone going to school or with kids in school knows this, prices are going up, up and away, as are energy and utility bills, property taxes etc. But incomes are not and have not been rising accordingly for 30 years or so, at least that is the consensus from articles I have read. The economy is sluggish, especially the housing sector. The GDP is largely spurred by consumer spending. If interest rates go up, it could curtail growth. That is why I think, although there is inflation, it will be hard for the Fed to curb it by increasing rates, rather it may feel pressure to do just the opposite to keep the economy, mildly, humming. There are two very differing view on where interest rates are headed. If I were you, for now, I would keep an eye on your local banks advertised interest rates for home equity loans. If you see an appealing deal, move on it. Even if you take out a HEL (Home Equity Loan), usually, you can pay it off with no penalty and many times there are little, if any, origination fees attached. A fixed payment at least is predictable. Always know what you are signing, as best possible. It may be possible, ask your accountant, the interest on a HEL may be deductible, whereas interest deductability for student loans has income limits. However, too many deductions can throw you into the AMT, alternative minimum tax. I'm not an accountant just a dentist, who's trying to learn about this stuff all the time too. Good Luck.
 

Doctor Chief

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CitiAssist seems to be one of the lower private student loans out there. I'm surprised the interest is so high on yours. Unfortunately, private student loan consolidation isn't as meaningful as federal is right now.
The only suggestion i can give you is pretty straight forward, pay off the highest interest debt first and hope that rates fall again. When and if they do, which they most likely will, lock them in at fixed.
One last thing, Loans may seem like a real pain and burden now, but there is no doubt that over your lifetime, the amount you paid for your education will be earned back and then some. It is a sure bet that a college education is well worth the money in the long run.
Good Luck.
 

okbye

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You can't get a fixed rate on private student loans by consolidating, they are always variable. You can consolidate them and look for a better repayment incentive plan though. Also the rates are credit based (which is why one person's rates may be higher than usual) so if your credit is better now than it was when you took the loans out you could get a lower base rate. I would seriously consider the home equity loan though, that is usually the first thing I would advise someone look into who has private student loans.

Two points about the pending student loan interest rate legislation - first, it has nothing to do with private interest rates. Private loans and federal loans use xompletely different systems to set the base rate. Second, any rate reductions will only apply to federal loans taken out after the legistation is passed, it will have no effect on any loans that you currently have.
 

ThreadkillerMD

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You can't get a fixed rate on private student loans by consolidating, they are always variable. You can consolidate them and look for a better repayment incentive plan though. Also the rates are credit based (which is why one person's rates may be higher than usual) so if your credit is better now than it was when you took the loans out you could get a lower base rate. I would seriously consider the home equity loan though, that is usually the first thing I would advise someone look into who has private student loans.

Two points about the pending student loan interest rate legislation - first, it has nothing to do with private interest rates. Private loans and federal loans use xompletely different systems to set the base rate. Second, any rate reductions will only apply to federal loans taken out after the legistation is passed, it will have no effect on any loans that you currently have.

I don't know about other lenders, but Citibank offers fixed rate consolidations for their citiAssist loans. http://studentloan.citibank.com/slcsite/fr_r_con.htm
 
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