According to the government, Perkins loans are the best types to have.
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I only got a Perkins loan once. Granted, the 5% rate on that is higher than my consolidated Stafford loans at 3.something%. However, maybe 8 years or so ago that wouldn’t have been the case. And unlike Staffords, you get a 9 month grace period rather than 6.
It’s a bit off-topic, but I’d just like to say that I think the way FAFSA calculates expected parental contribution is nuts. First, they include a step-parents income if you live with them rather than your two blood parents. While I’m sure my stepmother loves me, there’s no way she should’ve been expected to help pay my college tuition. Second, my dad and stepmom combined made a little over 50k combined, and they were expected to shell out over 10% of that to me each year. I didn’t get anything from them–what I didn’t get in loans I earned while working or charged to my credit card (cough:books:cough). I’m not bitter that they didn’t give me money–if anything it gave me more autonomy in college.
Just a quick correction–I’m not sure if the site I referenced is run by the government. Second, especially in the earlier years, students can have a higher yearly limit for Perkins loans than Stafford loans.
I was stating that the subsidized Stafford loan has a maximum loan amount that is lower than a Perkins for students first entiering college. If a studen’s parents are very poor, and therefore not able to afford the upfront fees or the difference between the cost of school and the amount of the subsidized loan, he/she is going to have a lot less money available, which could prevent the student from being able to afford to go to college. According to this site, a freshman who is dependent can receive a maximum $2,625 for their first year. On a Perkins loan, that student can borrow up to $4,000 the first year. The latter also has no fees, and repayment doesn’t begin until nine months after graduation.
On a related note, those who are making the claim that Stafford’s are cheaper right now don’t seem to be accounting for the origination and guarantee fees, which equal %4 of each disbursement.
So, I’m still not convinced that Staffords offer a loan that is just as helpful to the poor as the Perkins. Anyone have a cite to show otherwise?
That depends on where the student is going to college. The average tuition at a four-year, public instittuion for 2003-04 was $4,694 per year. Financial aid students received, on average, about $2,400 in grant money. That leaves, on average, $2,294 that must be taken in loans to fully pay for tuition costs - which is less than the maximum subsidized Stafford amount. Thus, even a dependent student can, on average, fulfill tuition obligations without a Perkins Loan. Note, however, that the poorest students would receive significantly more grant money (Pell maximum for 2003-04 was $4,050 per year) than the average, thus require fewer loan monies to cover tuition costs.
The average for tuition, fees, room and board at 4-year public institutions ran about $10,636 per year for 2003-04. The poorest students could easily receive the bulk of that in grant money, between federal and state funded programs (even at our lowly community colleges here in CA, students can receive upwards of $8,000 without ever touching a loan application, and none of these programs are institutional grants, such as many 4-year institutions have).
In general, then, the poorest students would likely never have to rely on the extra couple thousand that a Perkins Loan might provide. Stafford loans, even counting only subsidized loans, can often help cover the remaining costs for not only tuition, but room and board and other fees, as well.
Again, the dependent student only receives a maximum of $2,625 when counting both subisidized and unsubsidized loans. For only subsidized loans, there is no difference between what a dependent and an indepedent student may receive. Dependent students whose parents have been denied a PLUS loan may also borrow as per an independent student, with respect to unsubsidized limits.
This has no bearing on the interest rate of the loan.
See above. Plus, Stafford loans are not first-come, first-served (as Perkins loans have always been).
None of this is to say that Perkins doesn’t offer better loan terms than does the Stafford. It does, however, mean that without the Perkins program, students are not left with no other career choice than Chief Burger-Flipper. There’s a good deal of money to be had between federal, state and institutional programs - and that’s before even considering scholarships - if one knows where to look. Loans, and Perkins loans in particular, are not the end all and be all of available financial aid programs.
I really, really hope Stafford makes up for Perkins or I’m fucked. Completely and utterly. I can’t afford to finish college without them. I’m tired of working stupid-ass dead end jobs and without the jing I’m going to end up doing just that for the rest of my life.
Good point. However, I’m not sure that’s the case. It really appears to me that other programs will pick up the load, but that’s just my interpertation.
Ah, what the hell. The Bush-bashing will never stop. I have said this before - Bush could give CPR to a woman having a heart attack and there are those who would promptly flame him for copping a feel.
California has one of the best statewide financial aid programs in America, but unfortunately, not all poor people happen to live in California. Some live in places like South Dakota and Alaska, which offer none. Many states are also moving away from need based grants and moving towards grants for the academically superior. Needs based programs are losing ground against academic based programs, which once again, hurts poor people. A survey of the debt load of 4th and 5th year seniors, broken out by income quartile, shows the the lowest three quartiles all borrow between $12,000 and $13,000. The highest quartile borrows slightly less than $12,000. In other words, the poorest people in the country are having to borrow as much or more than any other demographic. Regarding the institutional grants, most of those are not need-based.
See above.
Let’s face it. No one has come up with cites that prove that poor people will be just as well served going forward as they have in the past. In fact, it looks like the opposite is happening (and has already been happening prior to now). For a lot more insight into the problem, here is some very interesting reading material. Poor people are getting screwed, and it shows in enrollment numbers.
You didn’t ask for such sites. You asked for sites which demonstrate that a Stafford loan is as helpful as a Perkins loan. If Perkins loans were phased out, there are other loan options available, and many students are simply unaware of grant options.
This is not to say poor students aren’t getting screwed; the unfortunate reality is that the Perkins loan isn’t the only Federal program that’s getting slashed. Taken together with the Perkins cuts, these will dramatically affect which students can afford college. While I can’t get too worked up about the loss of one loan program - all other things being equal (or possibly greater, given the proposed increase in Pell awards) - I can get worked up about across the board Federal cuts which results in all other things not being equal. An increase in Pell along with cuts in SEOG and Federal Work Study and phasing out of the Perkins loan amounts to far less money for needy students.
Depends on where you live, and there ain’t jack squat in my neck of the woods these days unless I choose to drop out. I hope that’ll change come summer.
What makes you think they’re not already working 60 hours a week. iIve got news for you. It isn’t enough. Implying that poor people are just lazy is one of the stupidest memes of all time. And saying “work for it” is a little disingenuous considering that the person who wants to cut these loans has never worked a day in his life.
Personally, I finished college at the blistering pace of twelve years, with a five year Navy enlistment smack dab in the middle of it. I got out of the Navy, worked full time, and finished college in the evenings. I’m still paying off my loans.
There’s usually a way to do the things you want to do in life, at least in this country. There are no assurances, however, that the options available are always easy or ideal ones.
Them’s the breaks. I accepted this and got my degree when I was thirty. There were a lot of people in class with me doing the same thing, and most were happy for the opportunity to do so.
I completely disagree that you can get whatever you want by working or that America is a meritocracy that guarantees class mobility through hard work. I think that’s a myth.
I think it can happen generationally. There are too many sons and daughters of laborers who are professionals to completely discount this.
My grandfather was a laborer in a steel mill. My dad was a foreman in a steel mill. I have one brother who’s a teacher, while I’m an engineer. Our other brother is a millwright, a skilled tradesman.
