I am new to this student loan stuff. My ex-wife handled it all for my oldest and never discussed it with me. Now that my son is going off to college, she dropped it all in my lap and said "It's all on you."
A Few Questions I have:
I am sure there are many more questions that I am not thinking of but this is a start.
Thanks in advance,
We'll need to know more about your income to point out what other loan options are out there for you. Sallie Mae has better interest rates if you start paying at least the interest as soon as the loan is dispersed via automatic deductions. I'm not sure about how stringent the loan requirements are, and I'll leave that to others in this thread.
I would ask you this though, do you plan on paying the loan back yourself? If not, and you expect your son to pay it back, please think very carefully about cosigning on this as it can have long term negative consequences to your financial future.
With your income OP, Sallie Mae is likely your best option. As I stated earlier, you can get an interest rate discount by beginning to pay the interest via auto-pay as soon as the loan is dispersed. This will help him stay ahead of the interest on the loan and keep the principle the same as when he takes the loan.
He's in a good field and should be fine. It's good he'll have some skin in his education. Good luck.
I have experience with the private student loans. I would suggest that you exhaust all other options first before going with a private student loan (Pell Grant, Federal student loans: Sub. and Unsub.first). Those loans are guranteed. Many schools will let you take max payment on the student loans. When I was in school I was taking 8 credits per term, and would receive around $3000 in student refunds. The private student loans are going to be based on your credit. I do not see your current FICO scores, however, for the private student loans they are usually looking for 720+ FICO scores, and that old collection account more then likely will hurt you. They are looking for very very clean profiles when it comes to private student loans. The reason for this is because the interest rate is much higher then then federal student loans. So typically people turn to these once the federal side is used up. With that being said people typically will have $60k in student debt on a bachlors when the federal loans are all used up. So the really clean credit file gives assurance that the loan will be repaid. Hope this helps.
Depending on when that unpaid debt occurred it could hurt your chances of acquiring a private loan through a bank, and will most likely affect the interest rate you get approved for, which is a bummer.
I think that you would stand a better chance of getting a favorable rate through the federal student loan program. They have parent loans called PLUS Loans. Here is an article that will give you some helpful tips about applying for federal student aid.