When I first entered into college, I did not know much about student loans or how to even think about affording the tuition that I now was responsible. It was either go to college and go into debt or simply get a job at the local coffee shop and try to save enough money to be able to afford college. The latter of the two did not seem like the best decision to make at the time, so I chose to take out student loans.
My Overwhelming Debt Amount
So I am currently paying back my student loan debt – which is pretty hefty. Of course, it is not all in one loan and is instead split up among multiple loans that I took out at different times in my college career. Though all of the individual loans are relatively small, they do add up and quickly started to consume my life when I first entered repayment.
Unfortunately, almost half of these student loans were private loans and not funded through the federal Direct Loan program. This meant that I had to start paying them back immediately while in college, or else interest would accrue. I am sure you can picture my amazement when I found out I needed to shell out over $50 per month even before graduation. This also put a strain on the relationship with my parents because I simply could not afford it at first.
Since my parents cosigned on my private student loans for me, I did receive a better interest rate than I would have if they did not. Actually, I probably would not have been able to borrow any private money should they have decided not to cosign for me since I had little credit history.
Since my private student loans were cosigned by my parents, I did not have much freedom to do what I wanted with them and I was still reminded every time the bill came due what was riding on my timely payment. Fortunately, I was able to get out of this situation and I am able to take full responsibility for my own debt without the worry that if I miss a payment, I will mess someone else’s credit up.
Releasing My Parents as Cosigners
I did discover a way that I was able to release my parents as cosigners on my student loans – refinancing. I chose to refinance my student loans a few years after graduation and my credit score was good enough to do so without the help of anyone else. This alone was a feat for me and I am proud to be able to say that I did it.
When I chose to refinance, I was able to merge ALL of my student loans into one and receive a better interest rate on them. Therefore, I did not have to pay as much in interest as I was originally going to have to.
Another option I had was to release my parents as cosigners on my student loans. This meant that I did not have to worry about their pressure to make payments on time, even though I still did and do. It was just a relief knowing that someone was not counting on me to make those payments.
My Personal Student Loan Experience in a Nutshell
I am glad that I have learned as much as I have about student loans, but I do wish I knew about them BEFORE I decided to make the decision to have my parents cosign on them. Actually, if I could redo it all over, I would look for ways to pay for my schooling other than student loan because they truly are not fun and they can create more of a headache than they are actually worth.
My student loan debt is currently being handled by me alone and I am able to make the decision on whether or not I pay the minimum amount or send additional money to the lender. I am happy that I refinanced my student loans too because I will save thousands in interest alone! Not only that, but my credit report is sure to thank me later down the road.
Drew Cloud is the Founder of The Student Loan Report – a site dedicated to keeping student loan borrowers and their families up-to-date with the latest student loan news and information.