A Eye-Opener on Private College Loans

Here is a short video (created by the United States Student Association) that I come across with telling about how college students get indebted because of federal and private student loans over the course of their pursuit of college education. One mentions that she might be finding herself getting really burdened with college school loans to the amount of up to 100 to 150,000 dollars by the time she earns her college diploma. Another student could not even believe he already owes a quarter of 100,000 dollars in loans, a huge amount of money that he has not seen much less held on in his life. This is the grim reality of getting private college loans as a last resort for the many American students wanting to finance their college. Loans get out of hand, repayment responsibilities become seriously unmet and the indebted is in the red as far as his financial status is concerned.

What's Missing from These 50?

Now as many of you know, I am not a fan of the "Best" school lists. I think they put way too much emphasis on marketing, and no emphasis on what is the best school for your student. That said, I'm going to discuss a recent article from Business Week magazine. There is something very peculiar about it.

In the February 28th issue of Business Week, the magazine ran an article on the top 50 schools to get a Bachelors degree in Business. The article starts with Rutgers University and finishes with the Wharton School of Business at the University of Pennsylvania. But there are some glaring omissions from this list that everyone would assume would be in the top ten. No where in this list will you find the names of Harvard, Princeton, Yale, or many other excellent schools. Harvard, home of the Harvard Business Review, the gold standard of business case study education did not even make the list?

Does this mean that Harvard, Princeton, and the like have not been putting enough resources into their business schools to compete with schools like the University of Illinois, the University of Texas, or Brigham Young? No, obviously that is not the case. What this article does show is there is no practical standard that anyone can use to come up with a list of the 50 "Best" schools of anything. I will say it once again, the "Best" school lists are not much more than beauty pageants that do little to nothing to help your student find the best school for them. Avoid them.

Hawaii & FAFSA Truth

Weather like what we've been having here in the Midwest makes me think of warmer places. So I'm profiling two schools in Hawaii: The University of Hawaii at Manoa and Hawaii Pacific University.

University of Hawaii at Manoa
Honolulu, Hawaii

Out of state COA: $24,782
In state COA: $15,518

Family Need Met: 68%
Avg Free Money: 39%
Avg Self Help: 61%

Founded in 1907, the University of Hawai`i at Manoa is the flagship campus for the University of Hawai`i System. A land-grant, sea-grant, and space-grant institution, it is the only public university in Hawai`i. UH Manoa is a diverse and doctorate-level university that emphasizes academic quality; research in Hawaiian, Pacific, and Asian studies; and community services.

  • Founded: 1907
  • Location: Honolulu, Hawai`i; in the Manoa valley on the island of O`ahu
  • Campus size: 320 acres
  • Colleges: 11
  • Schools: nine
  • Degrees: bachelor’s degrees in 87 fields; master’s degrees in 87 fields; doctoral degrees in 51 fields
  • Average class size: 31 (freshman and sophomore)/20 (junior and senior)
  • Student-faculty ratio: 16:1
  • Percentage of faculty with doctoral degrees: 80
  • Accreditation: Accrediting Commission for Senior Colleges and Universities of the Western Association of Schools and Colleges

Hawaii Pacific University
Honolulu, Hawaii

COA: $26,740

Family Need Met: 79%
Avg Free Money: 40%
Avg Self Help: 60%

Hawai'i Pacific University is more than an excellent university with outstanding and rigorous academic programs, an ideal location, faculty who are well-respected in their fields, students from all over the world who come to learn in a multicultural environment, and a service orientation emphasizing individualized attention to each student. It is also a comprehensive university offering a number of unique experiences, events, and traditions for its students, faculty, and staff as well as the community.


A recent issue of US News and World Report contained an enlightening article on the college financial aid system. Two Harvard University economists have completed a thorough study of the FAFSA process. Not surprisingly, they concluded that the FAFSA on average takes ten times longer to complete than what the schools and Department of Education claim.

Opting for Fixed Rate Private Student Loans

College students are worried about their private college loans having higher interest rates because of various factors such as economic dislocation, inflation and recession. Still they can always resort to getting fixed rate private student loans – this is the real way to go in the first place if you want stability in the amount that you need to pay every month.

The disadvantage of variable rates on private college loan is that it is dependent on so many things, which means there is a possibility of such loans to shoot up to immensely huge amount, hence becoming difficult to manage and pay back.

This is certainly the advantage of fixed rate private student loan. It stays the same no matter what. There is no fluctuation in the amount whatever the state of external factors such as the economy may be.

However, one disadvantage is that there will be periods of time when the percentage might go lower. And so students with private student loans with fixed rates will unfortunately not be able to take advantage of it.

Still, if a student decided on getting fixed rate private student loans, they should first look into all possible options. A prospective borrower must consider the interest rates at which the loan is locked, the schedule and duration of repayment, as well as possible repayment penalties.

It is advisable to get for yourself a fixed rate private student loan if the duration is three years or much longer.