wildcat09

I just had a quick question, first here is a little background. I am a regional FO and I went to DCA. I had to take a loan out to pay for school. Unfortunately, I chose a key bank alternative loan (private loan). My current balance is 124k. It is a 20yr loan with adjustable rate. While I am not having problem paying it now, it is frustrating that I am paying more on this a month than my mortgage. Does anyone with this type of loan have any advice on how to covert it to a fixed rate. No banks that I have spoken with will touch this. I have only lived in my home for 2yrs, so not enough equity in it. I would like to get fixed rate for 30 years to free up some money. Any advice would be appreciated. Thanks

bryris

The problem is that it is a high risk loan. There is no collateral. The only reason that home mortgages are lower is b/c the house can repossessed. The bank cannot take back your education and sell it to secure their investment. A bank would have to put out $124,000 - backed up by nothing. This is why banks won't touch this loan. Its just reality. Perhaps you could get a cosigner (or a surety company perhaps - but that fee would probably eat up any savings). Is something like this an option? Do you have any family members that would be willing to potentially sign with you on a loan mod/refinance?

My advice would be to just go with it until you are making more money and get into a position where you are paying as much money as you can afford toward paying off the principle. The more principle you pay off, the less money is wasted on interest.

Probably not the answer you were hoping for, but it is the way it is. I always recommend people not go into debt over this profession. But I know it is difficult sometimes with the increasing price tags.

Good luck!

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dbrault17

By nothing? How about his entire life of earnings through wage garnishments? Student loans are not bankruptable. They can never go away unless you die or pay them off. That seems pretty secure to me.

bryris

Take that to the bank. See how far it gets you.

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Led Zep

My advice may seem a little extreme, but nonetheless I will share with you my $0.02.

First, you mention that you have a mortgage as well as a loan for training - and the loan for training isn't small. So, I would look into one of two things: If possible I would put the house up for sale, rent (cheap) and put all available funds towards your loan. If you cannot sell the house I would seriously look into taking in a roommate and using the rental income to pay down your loan. Plan on paying it off way early. Owing money is like having chains on your shoulders - the more you owe the more you are weighed down.

I know it doesn't exactly answer your original question, but that would be my advice.

Pilotswife4

These loans are Fully dischargeable in Bankruptcy..Ive known a few people who had to go that route. They are not government student loans. So they are technically completely unsecured loans.