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Stopping the bleeding

November 17th, 2018 at 01:11 am

To stop the bleeding I have to pay an extra $200 a month on my student loans. Today I made my first $100 extra payment. I’ll be doing this each pay period. These things are highway robbery. It’s sad that any extra payment does not go to the principle first.

I’m writing my state senators and congresswomen and men. This is God awful

Posted in | 7 Comments »

7 Responses to “Stopping the bleeding ”

  1. creditcardfree Says:
    November 17th, 2018 at 02:02 am 1542420122
    1542420122

    I'm sorry this is on YOU! You signed up for these loans. True, maybe you weren't informed well, or naive, but you agreed to these payments. This is not a government problem.

  2. LuckyRobin Says:
    November 17th, 2018 at 02:08 am 1542420484
    1542420484

    This is why we won't take out loans for our kids to go to college. It would destroy us financially. We are already on the brink without adding that kind of usary to our lives.

  3. Amber Says:
    November 17th, 2018 at 02:21 am 1542421300
    1542421300

    CCF I usually agree with you but not on this one.

    The issue that I have is, any other loan you pay extra on it is applied to the principal (e.g car, home, credit card). I don’t have any problems with paying what I owe, even with the interest, the lenders goal is to make money as with any other business. However, I do have an issue when it’s designed with loan shark tactics. Yes I signed up for it, I’m paying it, however; I can’t believe that anyone would agree that a 20k loan would hit 70k due to interest in a few years (numbers are only an illustration not exact).

    We just have to agree to disagree on this one.

  4. Amber Says:
    November 17th, 2018 at 02:23 am 1542421387
    1542421387

    LR I don’t know what I was thinking. I worked two jobs and paid my way through undergraduate school. Just going to get a second job to pay this baby off

  5. AnotherReader Says:
    November 17th, 2018 at 03:46 am 1542426393
    1542426393

    I don't understand. Are you paying all the interest on the loans when due? Or does your payment cover less than what is needed to amortize the loan and some of the interest rolls over?

    Any unpaid interest becomes part of the principal balance and interest is charged on all of the principal balance, including unpaid interest.

    It would be in your best interest to understand the terms of your loan and how your payment is calculated. Whatever your minimum payment is does not matter. The payment you want to make includes all of the interest due and the scheduled principal.

    What types of loans are these? Can you refinance them to lower interest rates? That would be something to look into once you have closed on your house.

  6. Petunia100 Says:
    November 17th, 2018 at 04:04 pm 1542470652
    1542470652

    I like to use the Rule of 72 to estimate both growth of principal and interest cost. Are you familiar with that? You divide 72 by your interest rate; the answer is how many years it will take for the principal to double.

  7. Petunia100 Says:
    November 17th, 2018 at 04:09 pm 1542470961
    1542470961

    In this case, a principal balance of 20k turns into 70k. So it doubles once to 40k, then comes close to doubling a second time.

    If your interest rate is 7%, it would take 20 years for 20k to turn into 80k, so about 17-18 years to turn into 70k.

    At 10%, it would take about 12 years for 20k to turn into 70k.

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