What are the success and failures of using the Private Finance Initiative route for a college?

Question

What are the success and failures of using the Private Finance Initiative route for a college?

Answer 1

Private student loans are EVIL and should never be taken out under any circumstance.  These substandard loans have higher fees, higher interest rates and no government perks.  Plus the loan companies have virtually no limits on what a student can borrow, so you see kids 22 years old with debt upwards of 200K and are often qualified to be a Kinder garden teacher... if that!

Answer 2

You should definitely explore governmental loans before turning to private loans. Government loans offer lots of provisions to help you manage and pay down the debt, and they can even offer subsidies if you qualify so that you can avoid interest rates while you're in school.

Step 1 is to fill out a FAFSA: http://www.fafsa.ed.gov/

You should try to avoid private loans if you can. They often have higher interest rates, no cap on borrowing, and can have lots of hidden fees and terms. Think of private loans as putting your tuition on a credit card. If you miss even one payment, your interest rates could spike up to 20% or higher! Definitely exhaust government loan options before going the private loan route.

Good luck!