The Do's and Don'ts of
Culinary Student Loans
Compiled and presented by Chef Jennifer Gordon
Do
- Ask Questions don’t be afraid or pressured to ask how
much it will cost you monthly and the interest rate, if it is flexible rate or
fixed.
- Ask for a repayment schedule and be
sure you understand it
- READ the agreement including that
pesky small print. Make sure you fully understand the wording and don’t be
afraid to ask questions if you don’t.
- Look for key points in the agreement
like the interest rate and the repayment schedule.
- Ask if they offer any other funding
options
- Find out if there is a penalty for
paying back early
- Find out if there is any insurance
available for example if you can’t work due to injury or you can’t make a
payment.
- Remember these are sales people and
want your business make them work for it and make sure you feel satisfied
- Find out if dropping out of school or
taking a year off effects the payment plan some colleges make you repay the
moment your done school
Don’t
- Sign right there and then take it
home and read it and ask someone else whom you trust to read it. Or take it to
a financial advisor they may charge a small fee but in the end it’s worth it.
Any company that says you must sign here and now are NOT worth it.
- Think that this is your only option
there are many options out there for young people or people with poor credit.
- Be seduced by free offers and prize
giveaways if you sign up today.
- Be afraid to take someone with you
for a second ear when talking to an advisor about your loan. Sometimes two
sets of ears are better then one.
- Sign your name to something that has
no facts or figures if it doesn’t let you know how much your going to be in
debt for its like signing a blank cheque.
Some points to watch out for:
Before you sign for a loan make sure you
completely understand what you are getting into and what kind of commitment it
is. You must remember what you sign today could stay on your credit history
potentially for 7 years or more. Look for points that may include your assets
such as houses or cars this can also be called collateral. Look for the words
like “we can charge up to 21%” make sure you find out what they are charging
each year. You are entitled to know how much your loan is for and how much
interest will accrue and how much you will owe at the end make sure you know
this before signing your name.
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