student loan question

[Qacer]

Hey all,

I was looking at the Bank of America private loans. I saw the following examples:

Principal loan amount $8,000
Origination fee 8%
In-school rate 7.28%
In-repayment rate 8.13%
239 monthly payments $76.15
Final payment $77.70
APR 9.15%

What's the difference between In-school/In-repayment rate and the APR? I don't quite understand. Thanks!

 

[Mo0o]

That's a terrible plan. Get a federal loan that has no interest while yo'ure in school

 

[Qacer]

Actually, it is for a friend of mine. He is an international student, and I am co-signing. Thanks! So, what do the terms mean?

 

[Mo0o]

Originally posted by: Qacer
Actually, it is for a friend of mine. He is an international student, and I am co-signing. Thanks! So, what do the terms mean?

In-school means the interest that accrues on the debt while he's enrolled in college. When hes out of school and starts repaying the loan, the interest jumps to the in-repayment level. Atleast tahts my understanding

 

[jlee]

APR is the final rate when you factor in all the loan fees/etc.

Prime is currently 8%, but I'd like to think he could find a better deal somewhere..

 

[BigJ]

Originally posted by: Mo0o
That's a terrible plan. Get a federal loan that has no interest while yo'ure in school

The only federal loan that qualifies for that would be the Stafford Subsidized Loan.

Since he's a foreign student, I don't think he qualifies for any Federal Aid.

 

[Mo0o]

Originally posted by: BigJ

Originally posted by: Mo0o
That's a terrible plan. Get a federal loan that has no interest while yo'ure in school

The only federal loan that qualifies for that would be the Stafford Subsidized Loan.

Since he's a foreign student, I don't think he qualifies for any Federal Aid.

Yea he didn't explain the foreign student part in the OP

 

[Baked]

I got my loan from U.S. Department of Education. It's called Direct Loan. Look that up, it's the bomb.

 

[tennisflip]

Originally posted by: Baked
I got my loan from U.S. Department of Education. It's called Direct Loan. Look that up, it's the bomb.

I looked it up, but I'm confused. Is this the same as a subsidized/unsubsidized Stafford loan? I already got the maximum out of Stafford loans so I'm looking for an alternative source of funds.

 

[Qacer]

How about this?

Prime Plus Origination Fee APR Payment During Defer Payment After Max Defer
0.00% 0.00% 7.50% $50.00 $74.15
1.75% 0.00% 9.25% $54.99 $84.70
4.00% 0.00% 11.50% $68.37 $93.68
7.00% 0.00% 14.50% $86.21 $106.38
9.75% 0.00% 17.25% $102.55 $118.66

Assuming that we get 7.50%, that's close to my credit card APR.

 

[henryay]

Yes that is the same as the stafford loans. It is correct that the interest is lower while you are in school. I actually have the same private edu loan with BOA.