What happens to existing student loans BTW?
Not sure, my daughter is starting college in the fall 2010, I just filled out my Parent Plus Loan App (she is only 17 so I cannot co-sign for her until she is 18 in December), anyway this whole thing bothers me, she white, smart, middle class... I am worried about next year and the OBAMA $$$. She did receive 2/3 tuition in scholarships/grants but the remaining 1/3 will be a student loan.
Good questions. From what I heard, those loans obtained prior to July 1 will continue (tho most students only get loans one year at a time).
Given the economic climate, I am not sure that banks would want to take on a non-capitalized loan—in past they did not need collateral because the government guaranteed the loan. That said, probably would not rule out a parents home equity loan or credit line on a stock portfolio....
Just another example of further government intervention.
I suspect without the government guaranties it’d be that old case of only those who don’t need it getting a loan. (Just how good a bet were students before the Mac Daddy came in paying everyone’s loan?)