Families Struggle to Pay College Tuition as Costs Soar in Florida

The costs of higher education continue to increase faster than the overall rate of inflation. Parents are struggling to pay tuition costs for their children. Although funding college was never easy, the ballooning increase in tuition and fees forces many parents to take out loans they may not be able to repay. These excessive loans can worsen your financial situation and drive you to consider filing for bankruptcy protection. In the past, families would often fund college expenses through a second mortgage. But as home prices have plunged borrowers no longer have adequate equity for a second mortgage. Many parents are turning to other forms of funding. One popular choice is the Parent Loans for Undergraduate Students (PLUS) loan. This loan is government issued and requires no collateral. But a PLUS loan comes with a 7.9 percent fixed interest rate. Differences from Student Loans Student loans differ from PLUS loans in two important ways: Student loans carry lower interest rates Interest on student loans accrues after graduation, which makes student loans generally favorable However, a larger student loan award generally is only granted after a PLUS loan application is rejected. College financial aid officers have voiced concerns about this system, according to U.S. News. They find that PLUS loans are awarded to financially strapped parents, who may not be able to repay the loans and need student loan debt relief. Bankruptcy and Educational Loans Bankruptcy is designed to aid individuals attempting to manage excessive amounts of debt by offering a fresh start. However, a PLUS loan is not dischargeable in bankruptcy. Forgiveness from a PLUS loan is only granted in extreme...
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