Finance

Consider Financing Your College Expenses With a Personal Loan or Home Equity Loan

Parents who are contemplating the expenses of financing a college education may find alternative options such [such as personal loans or home equity loans] to offer more favorable loan terms when compared to student loans.

Finding the best student financing can be achieved by exploring all opportunities.  Personal and home equity loans offer fixed interest rates, which means student borrowers will not have to worry about their payments changing throughout the repayment period.

Home mortgages also include principal and interest payment deductions through tax credits, while student loan payments are not tax-deductible.

Student loan debt can have a significant impact on families’ personal finances due to the lack of job prospects for recent graduates combined with student loan repayments that do not qualify for sufficient tax breaks. Exploring alternative financing may offer lower interest rates and more favorable loan terms. Personal loans can offer terms between one to five years, and many lenders are now offering student loan refinancing for borrowers who want to consolidate student loans.

Home equity loans are an option if student borrowers do not qualify for student loans or personal loans, and families can borrow up to $100,000 based on home values in the United States. Many lenders offer student loan refinancing at lower interest rates than private student loans; however, it may be necessary to make a minimum home equity loan amount before refinancing student debt. Student financing should include all financial tools available when planning for postsecondary education costs.

Personal Loans like Student Loans have Pros and Cons for both Parents and Students

All content of this newsletter is intended for general information purposes only and is not intended or implied to be a substitute for professional legal advice. Reading any articles or receiving answers in forums is NOT equivalent to receiving formal legal advice from interest rates below five percent. If you are looking for the best options for financing a college education and are considering a home equity loan, student loan or personal loan, it’s always a great idea to seek the advice of a professional financial advisor.

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Steven Gregory