Ask MetaFilter questions tagged with loans

Should I study abroad or just take a vacation?

tweedle — Wed, 23 Dec 2009 11:15:35 -0800

Should I study abroad or just take a vacation? I'm a sophomore in college and I have always wanted to study abroad. However, due to being nervous about leaving everything behind for a semester or a year, I've been looking at summer programs, and I figure I can try going abroad out for about a month this upcoming summer then next year I could settle down somewhere a little more.

I've found that right now, the summer program seems ideal. It's a program that visits 6 countries over 35 days in Europe. I get 6 credits that might actually be a hindrance to me (as in, they do absolutely nothing for me in regards to graduating) in subjects I only have a vague interest in. However, I'm sure I would enjoy myself in these classes and learn a lot.

The classes are taught by visiting bunches of museums, etc., and having a professor teach.

However, for me to go on this expenditure, I would need about 8000 or 9000 dollars. I am a college student with a part time job, and I figure by the time the trip rolls around I would probably need to take out a 4000-5000 dollar loan. I haven't really researched vacation packages, but they are certainly cheaper. I think I might be able to afford one of them without taking out a loan, or at least my loan would be significantly less.

Quite honestly, I just want to do this for the experience of seeing the world beyond the US and seeing other cultures. I don't really care about the formal education part... I also have the idea in my head that if I don't travel now, while in college when I have relatively few responsibilities, I might never get to go.

Studying abroad would look good on my resume, right? But is that worth the extra thousands of dollars?

Also, I am fully confident that, assuming nothing terrible happens like losing my job (which is unlikely), I would be able to pay off this loan probably before I graduate. Really the study abroad trip, with food and airfare and the cost of the program, is 7000 dollars but I would feel nervous about having zero dollars in my bank account. Would paying a loan off like that make my credit go up? My credit score is already good, but it can always be better, right?

The study abroad trip seems really cool but I just don't have all that money, and I really want to go now instead of waiting. It is just so much money. My money is just sitting around now, but still I don't want to part with it.

I know that going alone would be the cheapest route but I would rather go with a tour group.

So, is it worth it to study abroad when I don't care about the formal education aspect as much as I care about the experience of going, or should I just find a vacation group and go with them? Advice and anecdotes please!

Which student loans to pay off first: Stafford or private?

Muffpub — Tue, 15 Dec 2009 19:03:02 -0800

Student loans in the United States: I have larger fixed-interest Stafford loans, and smaller private loans tied to LIBOR. Which should I pay back first? Thanks to anyone in advance for being patient enough to read this.

I'm just entering the beginning of my payback period for my student loans in the U.S. and I'm wondering which I should prioritize fiscally and pay off first, seeing as I'm going to have to lower my monthly payments on at least one set of loans.

So I have two sets of student loans:
- A set of three private loans with quite low interest rates (~3.29% right now - around LIBOR + 3%) but which may rise in the future;
- A set of four Stafford loans, three fixed at 6.8% and one mysteriously at 2.48%. (I have not yet consolidated, but plan on exploring that ASAP.) Together the Staffords add up to about 1.5 times the size of my private loans.

A part of what complicates the situation is my ignorance about consolidation, which is something that I have to explore further with Sallie Mae (who services my Staffords.) One of my loans is now a Department of Education loan (but not the 2.48 percent one...) and I have no idea if I can even consolidate those altogether.

The larger question I'm facing is this: I can focus on paying off the private loans, but get hit by the Staffords' higher interest rates compounding on an already significantly greater sum. And I'm assuming the interest rates, even fixed, will be even higher consolidated / pushed out.
Or,
I can focus on paying off my Staffords, but risk the LIBOR going up past six percent, as it has done in the past, which could really hurt down the line. If these were relatively small amounts I can see it not making much of a difference, but with sums as big as these (over $10,000 each) I don't want to take a decision lightly.

I feel more comfortable owing the government than owing a private lender, but apparently while I was in college the world decided that I could no longer make financial decisions based on fuzzy feelings. So I'm making them based on the hive mind's judgement instead. Thank you all.

Is she on the hook for delaying the closing?

WyoWhy — Thu, 12 Nov 2009 17:45:10 -0800

Our daughter was set to close on her first house tomorrow and to move in to her new home this weekend. Today at 4 PM, her real estate agent called. The seller (the bank, the house is a foreclosure) will not sell and/or FHA won't finance because some flashing around the roof has started leaking and perhaps has damaged some drywall in the house.

Our daughter is too upset now to even discuss it. All she's saying is that she will have to hire the workers, arrange for the real estate agent to let them into the house, and pay to fix the roof and the drywall before she can close.

She also is certain that she is obligated to pay $100 per day until she can get that done, get the house inspected and reappraised, and close. Because it's raining cats and dogs around here, she can't get the roof repaired for a few days---not to mention the drywall. And then she'll have to keep paying $100 per day until a new closing can be scheduled. Yikes!

Her house-to-be is in Virginia (Alexandria), and I haven't read the contracts she's signed with FHA and the owner. She is insisting that she's on the hook for everything, all the repairs, and $100 per day no matter what and she's completely freaked out. She's crying too much right now to be of much use informationwise.

Does her interpretation of this situation sound right to anyone? It sounds weird to me that she could be fined for delaying the closing, but I really don't know much about this kind of thing or how standard contracts read.

Any advice?

Figuring out if a bank loan has been charged off?

Anonymous — Thu, 12 Nov 2009 12:43:58 -0800

Figuring out if a bank loan has been charged off? Is it possible to find out if one particular loan made by one particular bank has been charged off (or "written off")? The details, as much as I can relate: it is a single loan (not securitized), for millions of dollars. It is a mortgage loan, I checked the recording documents and can see that the mortgage has not been officially discharged. No news reports about Bank X writing off Big Loan, no analyst reports discussing it. I'm not turning up anything useful at the FDIC or OCC sites, but could be missing something. Nothing in the SEC filings for Bank X. Is there anywhere that would have a record of big loan write-offs? It seems like something that should be reported -somewhere- . I thought of credit reports, but Lendee is a company, not a person. This is in the US.

Small business failure.

eschatfische — Tue, 20 Oct 2009 15:36:10 -0800

What happens to the owners when a small business fails? Let's say that Mr. X started a small brick & mortar business. He had a reasonable business plan. He had a bit of savings, but also got an SBA loan as well as a bank loan to finance the rest.

Let's say that Mr. X sets up shop. He works hard preparing, he hires employees, he buys materials, he engages a marketer and advertises and markets the business, opens the doors and... customers just don't come. Let's say he gradually lets the staff go. Still few customers. He tries to find another business that will buy the business he set up. No takers. His hand is forced, and he liquidates the assets and closes the doors. Since he doesn't have a job, he can't repay the remainder of the SBA or bank loans.

What happens next to Mr. X? Does Mr. X lose his home, his car? Does he have to declare personal bankrupcy? Can his business be bankrupt without the risk of him losing his personal possessions?

How can someone wishing to start a small business insulate themselves against the risk of failure? Actual anecdotes about starting a small business and failing would be appreciated.

(Note: I don't own a business -- this is all purely hypothetical.)

Can bank charge off auto loan with totaled car despite continued payments?

Nickel — Sun, 11 Oct 2009 22:55:56 -0800

Car was totaled, bank that gave auto loan charged off the loan account because the collateral is gone despite us continuing with full and on time payments. What are our options? Our car was considered totaled by the insurance company, but the insurance company is refusing to pay for various reasons (not the point of this post, we've already hired a lawyer) so we can't pay off the loan in full. We've continued to make monthly payments in full to the bank that holds the loan.

However, the bank then sends us a letter saying they are charging off the account. A check of the credit report confirms that they have listed it as a negative account there. We call/write with proof that all payments have been made on time and in the full amount, they respond that it is their policy to charge off loans that have lost their collateral.

Is this legit? What are our options? It just seems wrong that they can charge off an account when we've been making all the payments and have proof of our payments.

She works hard for the money...

firei — Sat, 10 Oct 2009 10:05:20 -0800

A friend of mine wants to open a business, and is looking for information on business loans or grants specifically for women. I've been on the SBA and SCORE websites, but haven't been able to find too much info. Everyone always says that there's a lot of financial assistance for women looking to open businesses, but I'm having trouble finding it!

If it helps: I believe she is looking to open a dog grooming/training facility.

Specifics would be awesome, but general links would be alright as well.

Being an adult sucks. Can I be 18 again?

lizjohn — Wed, 30 Sep 2009 17:44:25 -0800

Help me/us gain perspective about working while in school, please! My husband and I have been going back and forth about what to do about school and work.

The boring background information: I worked full-time while I put myself through my first degree. My grades were good enough to graduate with honors from a state school, but they weren't stellar. I believe in accruing as little debt as possible while in school. When my husband attended college (he didn't finish) he was in a very time consuming program and only worked at his college radio station one night a week. He essentially didn't work and took out a loan to get by. We only recently paid off that loan.

Now: We are both going back to school and both have eyes on very competitive programs. My husband in struggling balancing school and work. We both have about 50 hours of school work left until we can apply to our professional programs. We have our two school days off, but the problem lies in the rest of the week. We both work in the retail world and could be scheduled anytime between 7am and 11pm. Simply to keep these jobs, we must maintain very open availability. The job market here is poor and most job moves we could make would be laterally in pay and in requiring open availability.

My argument: It's better live off your current wages and take out loans for tuition only. No point compounding loans when we can just take out as minimal as possible. Caveat, I know that once we get into professional school we will definitely take out loans. The question lies in the undergraduate and prerequisite courses.

His argument: School loans are among the cheapest/best type of loans to take. It is better to do your very best in school to get into the best programs then to just get by and get into an OK program (if you get in at all). We could power through school faster and with the "good jobs" we could get with these degrees, the loans would be easily paid off. We could scrape by living simply for years.

Further financial details: We own our car and we rent an apartment. We have some credit card debt and we are actively paying it down. My husband receives some grants for school, which cover most of his tuition. I have 5k in bonds set aside for emergency, some of which will mature soon. In 2012 we will receive the proceeds from a moderately sized annuity which we had earmarked for a down payment for a house. I have decent health insurance through my job, for which I need to maintain full time status. Neither of us could support both on one paycheck.

What to other people do? Do most adults work through college? What about when their spouse in attending school as well? How common is it to live off loans?

Sorry if this is rambly, we'd just like some outside prospective. We've been going back and forth about the loan situation for months.

If it matters, I'm going into pharmacy and he's going into law

How do I cash a Canadian Student Loan while in South Korea?

Knigel — Thu, 24 Sep 2009 09:04:37 -0800

Need to cash my Canadian student loan but I am in South Korea. I've been confirmed to receive my Canadian student loan; however, I need to bring the form to the Canadian post office so that they can confirm it. Unfortunately I can't seem to do it from South Korea. Last semester, I had the same problem; however, my mother sent me the form, I signed it, and sent it back to her and there was no trouble when she brought it in. They put the money into my bank account. This time, the post offices state that I need the power of attorney. What can I do? My classes have already started and I need to pay for everything.

Best strategy for paying student loans?

yeoja — Tue, 22 Sep 2009 14:37:41 -0800

I’m in grad school and work full time. I have several Federal student loans in deferment, all of which are subsidized or unsubsidized with different interest rates. I have an extra $500 each month that I'd like to use towards my loans. If I want to have lower monthly payments when my loans go into repayment, should I make extra payments now towards the interest from unsubsidized loans with a lower interest rate or the principal of subsidized loans with a higher interest rate? Or is there a better approach? Background info: I have 1.5yrs left for school, and I’m 90% sure I’ll continue to work full-time until I graduate. Other than my mortgage and these loans, I have no other debt (car and credit cards paid off). I have ~6 months of savings in a high (well, 1.4%) yield savings account.

My loans are distributed something like this:

Loan A: Unsubsidized, 1.8% interest rate, $5,000 balance

Loan B: Unsubsidized, 6.8%, $12,000

Loan C: Subsidized, 2.8%, $6,000

Loan D: Subsidized, 6.8%, $3,000

Right now, I make $150 monthly payments on the unsubsidized interest on Loans A & B. My lender will let me specify how I want to apply the $500 each month (Loan A/B/C/D, interest or principal). I know the usual advice is to target the higher interest rates first (as discussed here), but I’m unsure how this applies with subsidized vs unsubsidized loans. For example, Loan A has a lower interest rate than Loan D, but Loan A has a higher principal balance and is unsubsidized.

I want to make the smartest decision with these payments. My goal is to get rid of my loan fast, but I also want to minimize my monthly payment amount when my loans go into repayment. Should I focus on the principal of Loan B since it’s so high? Or should I spread out the money across the loans? If I have the money to pay off Loan D, should I go ahead and do that?

Can we afford this $445,000 house? How can you tell?

Anonymous — Sun, 20 Sep 2009 15:16:38 -0800

Can we afford this house in California (just an example)? What "rules of thumb" or other measures should I use to determine what is "affordable"? I have used many of the on-line "calculators" but I feel like there are too many variables which are not explained and there is too much variation. Can you look at our situation and help suggest how much house we can afford while remaining fairly conservative? What other "rules of thumb" or standard rules should I consider when determining how much house we (or anyone) can afford?

Total income: $120,000/year
House price: $445,000
Loan: FHA with 3.5% down
(the down payment is not set at this amount but it is so common that we use it when making comparisons).

We're fairly frugal and save more than average. We're both local government employees. The house is in Northern California (Bay Area). The house included above is just an example.

Conservative rule of thumb for front end debt-to-income (DTI) ratio -
28% of your pre-tax income = reasonable annual payment (before considering tax benefits):
$33,600/year
or
$2,800/month

Conservative back end DTI ratio:
36% of pre-tax income minus other debt payments.
We have about $600 of debt (student loan) payments/month.
$43,200 - 7,200 = $36,000
or
$3,000/month

I have received several "Good Faith Estimates" (GFE) for a loan in these conditions - the highest GFE (with most fees filled in) places our monthly payments at $2950.

Is that reasonable based on our income? How do you make that decision?

The tax rate for the city at issue is 1% (low) and no flood insurance is required. This is included in the GFE above. We also have a reasonable emergency fund.

Email questions/suggestions/issues to canweaffordthishouse@gmail.com

Thanks mefites!

Ik heb... financialaidie?

zvs — Thu, 10 Sep 2009 07:43:21 -0800

NetherlandsFilter: As a Dutch citizen, am I eligible for financial aid for school in the United States? I'm a US-Dutch dual citizen, and I'm starting grad school in the US soon. I was applying for FAFSA when I realized there's probably an equivalent program in Holland.

But I can barely read Dutch, let alone Google effectively in it. Has anyone successfully done this?

Experience with Quicken Loans for re-fi or mortgage?

tristeza — Thu, 10 Sep 2009 07:16:16 -0800

Does anyone have any experience with Quicken Loans for mortgage or re-fi; specifically, with the supposed "go with us and never pay closing costs again to re-fi or get another mortgage" policy? I'm trying to get a good deal on a re-fi (easier said than done), and am looking into Quicken Loans. They have offered me a good deal, but the broker is so aggressive that I'm considering telling him to fuck off even with his good deal.

However, he fast-talked me something about if I get a Quicken loan, I never have to pay closing costs again if I use them for another re-fi or new mortgage.

Does anyone have any experience with this policy, is it some bait-and-switch or what? (Please also feel free to share horror stories about them, I'm really leaning towards walking away but the deal is really good from what I can tell.)

Unda the sea

Anonymous — Thu, 27 Aug 2009 10:01:30 -0800

What to do about an 'under water' (financially) home? I knew my home had dropped in value since I bought it, like everyone else's, but when I called the other day to inquire about refinancing, I found out it dropped much further than I thought. It's now worth $10K less than my mortgage. Now I can't sell it without taking a beating.

So, is there anything I can do besides suck it up, keep making mortgage payments, and hope the property value picks back up again? I've heard some vague talk on the radio about stimulus relief programs for people with homes that are "under water" like this. Does that relief mostly come in the form of better refinance rates or is there something else to it?

Should I stay or should I go?

semp — Tue, 28 Jul 2009 08:33:32 -0800

Should I stay or should I go? I started college a year ago. Since then, I've found two horrible jobs: one which doesn't pay me unless I fight for it, and the other, until recently, was good but due to one small mix-up has taken a turn for the worse. The second company I have a contract with. Quitting that job would result in me paying back a years worth of rent, which I can hardly afford. I can, however, move within the company, meaning that I don't have to stay at this location.

For a while before both jobs took a turn for the worse, I was contemplating moving out to the west coast (namely Seattle) and finishing college there. Don't get me wrong, I'm happy at my current school, I just think that as a computer science major with a part-time commitment to another company (therefore during the summer I have to stay in the area) I would have more opportunities on the West Coast than I would in the Chicago-Indianapolis area. After weighing the pros and the cons I thought that staying at my current school would be the best for me. I'm not the best student here, but I have myself set up for success. I am in a position where nearly every professor in the department knows and likes me, and I have quite a few contacts at companies that I would risk losing by moving.

Then the problems with my job and the college itself started. Something happened at job #2 that was one of those "it's not your fault, but we need someone to blame" issues. Now I've been hit with a level of resentment that makes it impossible to get anything done or feel any sort of comfort in my work environment. At school I found out that for the second year in a row I am being refused the right to file my FAFSA as an independent despite being one on several levels, including taxes (filing as a dependent I am not eligible for any aide, but the idea of my parents contributing to my education is rather laughable). So now I'm back where I started. I need to finish the last year of my lease, but if I decide to move I'm probably going to take the year off of college and just work. I've talked about this all with my boyfriend (he's been my substitute family since I moved out almost, so his opinion does count) and he thinks it's ludicrous that I would give up my advantages for the unknown, especially since he plans to stay here for grad school (I don't think he'll make it in, so I don't know how seriously to take that concern, but that's a different story).

Pros:
Better working environment
Extensive world-wide travel (my contemporaries on the West Coast do world travel frequently)
A chance to see a new place (never been to Washington, and only Southern California)
Better chances at an internship and real part-time experience
Possibly more networking with companies
Different outlook on academics/new teaching style
Small (~$1,500) tuition decrease for out-of-state, Larger (~$5,000) if I can find a way to get in-state

Cons:
Boyfriend thinks I should stay/is staying
Almost have in-state tuition
Already very well established in my current area
Highly thought of despite not being strong academically
Loan companies will probably expect me to start paying them back (since I've been out of school for 6 months)

There are more factors that play in, but those are on an emotional level. I could add them into this, but I think in the end those have to be my choices and it would be pointless to act as if it were otherwise. What do I do?

Mortgages in the US in summer 2009

crapmatic — Mon, 20 Jul 2009 12:15:32 -0800

How hard is it for average folks to get a home mortgage in the US right now? The banking crisis and credit crunch has obviously been big news for awhile and it's common knowledge that lending standards have tightened up a lot. Yet on the other hand I see lots of posts on creditboards about people with ~600 FICO scores that seem to be able to get mortgages -- and if I recall correctly, this was subprime territory even a few years ago. It seems like homes around my area are getting sold just fine, and I don't see any windows boarded up at the local mortgage companies.

So what is the lending climate like right now? Who is and isn't getting financed, compared to a few years ago? What aspects of a mortgage application are underwriters focusing on most heavily right now?

Answers should probably mention the kind of market or location since Omaha might be much different from Brooklyn.

Risk-aversion shows I'm qualified, right?

Anonymous — Mon, 13 Jul 2009 11:59:57 -0800

Should I take out a full load of student loans to attend a top-6 law school right now? I just got accepted off the waitlist at the last minute. This is not a "should I go to law school?" question; I'm already excited and fully committed.

The question, rather, is how much risk should I take financially in this economy? I was not offered a grant or scholarship (and might have a better chance at being considered for one next year if I apply very early - I put my applications in very near the deadline instead of in the fall). I currently have a job that pays well enough to put some savings away by next year, let's say at least enough to cover living expenses over all 3 years, and hope to come up with some opportunities to enhance my income given the extra time. I also have some personal projects I could finish up and be satisfied overall with spending another year this way before embarking on a long-term, non-interruptible career path like law. Until this waitlist acceptance, I was perfectly content with reapplying next year.

I am passionate about becoming a lawyer but terrified of becoming a debt slave. I can't seriously consider the possibility of committing to a loan payment plan that lasts longer than 5 years; right now, my 5-year payment plan would be $4,000 monthly starting 6 months after graduation.

On the other hand, schools like Columbia, NYU and Chicago are extremely competitive. As I was waitlisted at all 3 this year, I may not be able to count on getting in next year and they don't give deferrals to waitlisted admittees. After applying to other schools, I am certain that these are the only ones I would seriously consider attending, especially on student loans. I think I might be game for big law, but my freedom to choose is more valuable to me than anything, and I don't want to be stuck with it if I genuinely hate it.

Biglaw isn't even hiring right now, and I certainly don't want to place a $200k bet that they will be by 2012. My loans and interest rates are a certainty; the economy and the effects the recession will have on the legal industry and my ability to thrive or survive as a member of it in the near future are anything but certain. If it becomes clear over the next 12 months that student loans this large would be a death sentence for anyone, I could come up with a plan B and be glad to have escaped such a fate, even if being a lawyer remains my first career choice.

So I could be making the biggest financial mistake of my life (there are suddenly no guarantees of summer associateships and huge starting salaries for anyone at any law school?!) - or throwing away the biggest opportunity of my life (admissions are likely to get even more competitive next year, although I do have competitive numbers and would like to chalk up having been waitlisted to having applied quite late and scoring a 6-point increase on the February LSAT after applying with a lower score from December). If I pass up an opportunity to go to my dream school that might not materialize again next year, I'll always regret it; if I find that my life is essentially over after graduation due to crushing debt obligations, I will probably lose the will to go on after a couple years. Which way to go?

Going back to school: how do I make it happen financially?

itsacover — Fri, 10 Jul 2009 23:01:48 -0800

I'm trying to go back to school. I have bad credit, some unpaid debt, and cannot afford any classes without help... Help! After 5 years, I'm going back to school to finish my undergrad. My current career is turning into a bust and I'm terribly unhappy with it, so finishing my degree seems like a good way to open new and enjoyable opportunities. I have roughly a year left on the degree. In an ideal world, I would quit my job and go to school full-time since I cannot do both at the same time (my field of work requires a completely flexible schedule). I also cannot afford to take classes without any help, even a class at a time. My income covers my bills and that's about it. I have credit card debt along with a few other things (around $3000 worth) that I am slowly chipping away.

Basically, I need someone to explain to me a) whether it's a good idea to try and get loans that would not only cover my school expenses, but also living expenses (I would get a part-time job also), b) how I might make that happen as I have never dealt with any sort of loans before (plus the bad credit!), and c) why this seems so difficult and overwhelming.

I am, of course, going to talk to the financial aid department at my school, but I would love personal experiences as well as advice from those smarter with finances.

Paying for graduate school out of your 401k. Stupid idea?

falameufilho — Fri, 03 Jul 2009 16:28:00 -0800

Paying for graduate school out of your 401k. Stupid idea? I have been working on a masters degree for some time now, paying out of my own pocket. It is not cheap, but I believe it will be worth it in the long run.

However, some extra income I was counting on to help me fund my tuition didn't materialize, so it looks like I could run out of money before I finish graduate school. I've been thinking about tapping into my 401k to cover the rest of my tuition, but I have a feeling that might be a stupid idea. Is it?

P.S.: I am not a permanent resident in the US, so student loans are not an option for me.

Paying for school

Anonymous — Wed, 01 Jul 2009 13:55:32 -0800

I have a pretty big tuition bill, even after Stafford and Perkins loans are applied. Can't pay it in cash. Should I take out another loan or take money out of the mutual funds? The thing that sucks is I had thought I could use all the money in my mutual funds to pay the school bills in the first place, and then when I started school last fall I lost nearly half of it. So far I didn't have to touch it, but it looks like tuition got raised and even if I saved every penny of my summer job I'm not going to be able to cover it with my bank account.

If I take out another loan, I have to pay interest on it. If I cash out my mutual fund, I'll basically be able to cover my bills for the rest of the year (and then I graduate) but I'll never see the money I lost in it ever again.

One other thing, so the money I have in the mutual fund now is about the same as how much I started with, seven years ago, but not accounting for inflation. So on the face of it you could argue I didn't lose any *actual* money, but if you account for inflation, I did. The question I suppose is whether I should wait for that mutual fund to recover or just cut my losses and use it so I don't incur more debt.

Sorry if this seems like a basic question. I am horribly bad with financial things, so the answer is not entirely obvious to me.

AskMeFi, what's AmOREtaZeeAtion?

hellogoodbye — Fri, 01 May 2009 23:01:26 -0800

Upon examining my student loan payments, it appears that my "interest amt last payment" numbers sometimes increase, even when I pay the same amount (more than I need to pay) on the same day of the month. What!? I am not a math person, nor one that has been very curious about the actual calculations on accruing interest. Here are what I think are the most important facts in this situation; I know there are many variables, but I'm hoping someone can explain this to me w.o me going into all of them. That said, I'll definitely clarify if it will help accurately answer my question.
I have been paying ~60-90% more per month on my student loans than is necessary, no principal has been added, interest rate is fixed and calculated on the formula "Interest rate x current principal balance ÷ number of days in the year = daily interest". I'm pretty sure the way my loan holders calculate interest has not changed in this time period.

So, why is it that on Feb 2 09 they received my $X00, and $X1.32 of that went to paid interest, but my Mar 2 09 payment of $X00 (exact same amt as last payment) put a higher amt $X6.11 to paid interest. Shouldn't the paid interest go down, while my contribution to the principal go up? Another confusing thing, as implied above, I pay varying amounts above the amt I should each month...but I noticed that particularly when I pay $(X-1)50, the amt of interest paid shoots waaaay up from the rest of the months...even from those where I pay less than that.

When I enter my data into amortization tables assuming I'm overpaying by a consistent amt every month, the interest correspondingly goes down every month...never up, so I have been blissfully assuming that that principle applied to my specific loan situation.

Sorry if I've made this needlessly complicated OR not detailed enough, but please shed some highly informed light on this puzzle!

How do I get a medical loan for upcoming brain surgery?

sickinthehead — Mon, 27 Apr 2009 15:34:54 -0800

I'm having brain surgery and need to get a medical loan for about 150k. Help? I'm having brain surgery - possibly within the next 3 weeks if I can get everything in order that fast. The price tag is 150k. I'm not sure how much insurance is going to cover, but I am dubious because it is a preexisting condition and I went through a half year where I was uninsured. My husband and I are looking into medical loans. I am overwhelmed by googling. Please, do any of you have any experience and advice that you can share with me about how to do this?

If anyone reading this has ever had brain surgery, please feel free to share any tips on anxiety management, etc.

How to get money to improve home

Anonymous — Mon, 20 Apr 2009 08:02:43 -0800

What are my options for borrowing money for home improvement? My wife and I need to build a new garage and want to add a bathroom to our house. Total expected expense of approximately $60-70k.

We both have excellent credit. We would exceed any credit requirements. I make a good bit of money. We just don't have $70k in a bank somewhere. We have $100k in equity in our house, which is valued at approximately $400k. We have just one mortgage that was refi-ed 4 months ago. Based on neighborhood, we will likely get the money from this project back out (but this isn't our motivation for doing it; I'm just saying that is not a factor).

Well, my wife went and asked Bank of America about it, and her recitation of the conversation boiled down to that there was no way we could get the money right now. She said the banks are not giving out loans for this kind of thing.

That blows my mind. I'm an absolute sure thing. With my income, I could change nothing about my living and pay $1-2k a month that would easily pay off a $70k loan. Why wouldn't someone lend me the money?

So, what are my options to get $70k to fix my house? Or am I not going to be able to get a HELOC or 2nd mortgage or whatever in this economy? If I am working with an architect and a general contractor, are there ways to set up financing like you would with a car if those two don't offer it themselves?

I'd like to know what my options are for borrowing that kind of money; who would be good sources of this; and what types of things can I say or do to convince a lender that there is virtually no risk in lending me money? I'd also like to get a general sense of how the amount factors in to the decision [The garage ($30) has to be done. The bathroom is just a desire].

Various other demographics which might be relevant: live in affluent and stable neighborhood in DFW area of Texas, married, no kids, dual incomes (one substantial, one good), perfectly clean credit, willing to pay premiums to get it done.

I set up a dummy account for any question or leads: moneyborrowquestion@gmail.com

Thank you.

What lender should I pick for my student loans?

amalgamator — Thu, 16 Apr 2009 21:36:15 -0800

Which lender should I use for my government student loans? I have previously attended a direct loan school and thus I had to take out my Stafford and GradPLUS loans through the school directly. I am now going to another school that is FFELP school and I can choose my lender. I was given a preferred list from the school. I remember reading that sometimes the preferred list isn't the best deal around. And that you should shop around. However, I've read that it's getting harder and harder to find great borrower benefits such as waiving loan origination fees.

I found a list of the top 100 lenders. Yet #1 on that list is Sallie Mae which is a terrible company?

Have any of you found a lender that you like with good benefits? Anything else I'm missing?

What are the effects of high inflation and high interest rates on an economy?

thewalrus — Sat, 04 Apr 2009 01:12:56 -0800

Economicsfilter: How do mortgages work in developing countries with high rates of inflation and high interest rates? For example, Pakistan has a 20% inflation rate and the average fixed term prime residential mortgage for people with good credit is priced at 17%. What are the effects of this on a market? Can anyone point me to economics texts or real world examples of the results of the following:

USD:PKR exchange has gone from 1:60 to 1:81 in less than one year.
Inflation rate steady at 18 to 22% per year.
Minimum mortgage costs for residential consumers in the range of 16.5%+

The Pakistan central bank sets a rate which results in a KIBOR (Karachi Interbank Offered Rate) of approximately 15%. The various big name banks in Pakistan mark this up a couple of percent and sell residential mortgages on 10, 15 or 20 year amortization terms for around 16.5 to 18.0%. These are not "sub prime" type rates but are for people who can put 20-25% down, with good credit scores and job references, the Pakistani equivalent of a non-jumbo Prime mortgage.

This obviously makes the purchase of an average 3-bedroom flat quite a bit more expensive than in the US or Canada, where mortgages for anything would be under 8%.

How did this work in Argentina when the currency dropped drastically against the US dollar? I know of people who got into the Argentine market at exactly the right time with a USD exchange (or Euros, or GBP, or whatever) and were able to buy up property at amazing prices. Were interest rates similarly high in Argentina during the same period?

Does a high inflation rate somewhat offset the effect of having a mortgage with a 17% fixed interest rate? If the mortgage contract is fixed at a certain payment, but the inflation continues, a theoretical Rs125,000 monthly payment will continue to get less expensive as time goes on...