Is the scholarship need based or merit based? Either way negotiate by asking them to review the file. Even another $1000 is $4000 + interest over 4 years. You can even contact the department if your daughter knows what she is majoring in and see if they have any funds. Again remember all efforts are usually upfront for 4 years of rewards.

As a side you may want to explain your situation to the financial aid office. The best deal is multiple kids in school at once, since the FAFSA then divides what you can pay amongst the schools. You likely will not benefit from this since your son is 5 years behind your daughter. Maybe this is a good negotiating issue and is something to think about in your financial planning.

Carefully consider the origination fee on the PLUS loan. I know for Staffords some are 3%, some are 1.5% depending on who is fronting the money, the state or a bank. Many of these loans also have interest rate reductions later on for a series of on time payments.

No matter what, pay all the interest on a PLUS or unsubsidized loan when it is due. You do not want the interest to amortize over the years.

My guess is you are best off in some sort of hybrid situation. Take all the PLUS loan they give you. Pay the interest. Save money in an investment. Then compare the performance verses cost of the PLUS loan. While in school (+ some grace period following graduation), the rates are cheaper for the subsidized and maybe PLUS (I am a student and my parents did not take PLUS so I am not positive).

Like others said, consult a CPA for any tax implications. My guess is that since you did not qualify for a subsidized Stafford, you may not be eligible for any of the tuition, loan payment credits.

Lastly, watch your debt to income ratio. 4 years at $13,500 adds $54,000 to your debt load.

In planning, remember schools costs have been going up at 5+% per year. Scholarships usually stay the same, while loan allowances increase. You may need to take the PLUS now to have money in later years for your daughter and even for your son.

posted by 155.246.1...

• OT: Should I take the PLUS loans for kid's college?, Dave in Houston, Sat, 26 Mar 2005 04:38:20
  • Thanks, everyone... and a few remarks..., Dave in Houston, Sat, 26 Mar 2005 16:52:20
    • Congratulations on your degree of preparedness..., MI-Roger , Sun, 27 Mar 2005 17:30:25
    • Ask successful friends, family, and pro. associates..., Allen K, Sun, 27 Mar 2005 07:29:00
  • Agree with MI-Roger + my experience ..., Urby, Sat, 26 Mar 2005 11:56:07
    • Re: Agree with MI-Roger + my experience ..., DKH, Sun, 27 Mar 2005 18:16:26
      • Allegheny College in Meadville, PA, Urby, Mon, 28 Mar 2005 09:07:27
  • Thoughts, awg, Sat, 26 Mar 2005 11:50:36 <-- Viewing This Message
  • Talk to a CPA or Financial Planner - NOW!, MI-Roger , Sat, 26 Mar 2005 11:03:46
  • call the guys at NHHEAF.org, a prodigal son, Sat, 26 Mar 2005 10:28:49
  • PLUS loans - we didn't, JimBlake , Sat, 26 Mar 2005 07:41:26
  • Re: OT: Should I take the PLUS loans for kid's college?, Chuck in SD, Sat, 26 Mar 2005 05:24:26
    • The way things are globally now, and will be in the, Drew in Hosuton, Sat, 26 Mar 2005 06:56:42

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