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Don’t Fall for these College Myths

It seems as if everyone has a different plan that they tout as being the best for saving for college. Families trying to map out a college payment plan face rough waters as the cost of higher education continues to rise in the face of a still-sick economy.

According to a study by the College Board, the cost of in-state public four-year institutions for the 2011-2012 school year rose 8.3%, compared to last year while out-of-state tuition and fees at public four-year colleges increased by 5.7%. At private nonprofit four-year colleges and universities, costs have jumped 4.5%.

Myth 1: High-income families won’t get any financial aid.
Many parents assume that if they make a high salary, their child won’t be eligible for any financial aid. Briggs says that it’s a good idea for families across the financial spectrum to complete a FAFSA form to see if they qualify for need-based aid and if not, to borrow money through federal student loan programs.
Every student should estimate how much he will likely receive with FAFSA4caster. Don’t avoid filling out a form because you don’t think you’ll qualify for Pell Grants. You may lose out on a university- or state-based grant or scholarship.
Myth 2: If you save too much, it will hurt your eligibility for financial aid.
Parents shouldn’t feel discouraged from saving for their kid’s education over the fear they might qualify for less aid.  Even if it works in your favor, the amount you might receive in financial aid from the government or the college would likely be significantly less than what you could have saved had you started early. The benefits of saving for any financial goal typically far outweigh any consequences of doing so. From a financial aid standpoint, parent assets are only assessed at about 5% after an asset protection allowance is applied, while student assets are assessed at a much higher rate.
Myth 3: The sticker price is the true cost.
Students and their families should distinguish between the sticker price of a school (the advertised price of attendance) and the net cost, which factors in grants or scholarships.
The truth is the sticker price on college doesn’t mean anything–don’t make any decisions until you personally receive your financial aid award letters and compare them.
Myth 4: Private schools are more expensive than public universities.
In general, experts say private schools are considerably more expensive than the sticker price of public schools. However, private schools have significant amounts of aid to award in need-based and merit-based situations, something that cash-strapped state schools can’t offer as easily.
All schools use a slightly different [need-based scholarship] formula, but that formula for many people results in significant discounts, so that $56,000 sticker price that you would pay at a Harvard or Princeton might be at or below the net price that you would pay at a state school.
Myth 5: Students loans are a bad idea.
Although the growing amount of outstanding student loan debt in this country continues to balloon, students shouldn’t be discouraged from borrowing for school. Families need to do their research, start saving early, and borrow only what you need so that your student isn’t left with a mountain of debt.
It’s OK to expect your child to take out loans on his or her own to pay for education beyond what you are able and comfortable with funding.
Myth 6: Uncle Sam doesn’t want you to go to college.
Parents should take advantage of the tax benefits of paying for their child’s education. There are several tax deductions, including the American Opportunity Tax Credit that is worth up to $2,500 per student for the cost of tuition, fees and course materials paid during the taxable year and 40% of the credit (up to $1,000) is refundable even if you owe no tax.
There are a lot of families who don’t claim their education credits in their full amount and that would save them money that they could then use to pay for education.
While it’s no secret that college can be expensive, students can have better control over their debt level if they make smart decisions from the get go.
You control which school you select, the way you purchase your textbooks, and how much you spend while in college. You can’t control your tuition prices, but you can make a dent in the cost of college with your own choices.Above all else, shop around for private student loans after you have satisfied all of your Federal Loans. And after you graduate, remember to consolidate your high interest private student loans with a private student loan consolidation.

Most Expensive Dorm Rooms

The Top 20 Room & Board Expenses 2011-2012

College Room/Board
1. The New School $18,080
2. New York University $15,181
3. Fordham University – Lincoln Center $15,000
4. Fordham University – Rose Hill $14,925
5. St. John’s University (Queens) $14,700
6. Suffolk University $14,624
7. Manhattanville College $14,520
8. Pace University $14,230
9. University of California – Berkeley $14,046
10. Marymount Manhattan College $14,030
11. Franklin W. Olin College of Engineering $14,000
12. Sarah Lawrence College $13,958
13. Dominican University of California $13,900
14. University of California – Santa Cruz $13,869
15. Harvey Mudd College $13,858
16. Cooper Union for Advancement of Science $13,700
17. University of California – Santa Barbara $13,694
18. American University $13,684
19. Claremont McKenna College $13,625
20. Vanderbilt University $13,560

Update on College Costs

Average annual tuition at four-year private colleges for the 2011-2012 academic year is $28,500, up 4.5% from a year earlier, according to the College Board, a New York-based nonprofit that administers college entrance exams, while average room and board charges have risen 3.9% to $10,089. Between 2001 and 2012, tuition and fees at four-year private colleges rose at an annual average rate 2.6 percentage points greater than the consumer-price index. The priciest colleges now cost close to $60,000 a year.
Debt, too, is on the rise. Students who graduated from college in 2010 are shouldering an average $25,250 in debt, up 5% from a year earlier, according to the Project on Student Debt, a nonprofit research group.
The most important element in applying for financial aid is the Free Application for Federal Student Aid, also called the FAFSA, which determines how much in federal grants and aid a college-bound student will get. The form, which is used by all public and private universities, asks families to provide income and asset information, but doesn’t require you to report the value of your primary residence.
If you are attending a private college, families also must fill out the College Board’s CSS/Financial Aid Profile, which schools use to determine how to distribute their own aid funds.
The CSS takes into account factors that are largely ignored in the FAFSA. For example, the CSS looks closely at home values: Parents who have seen their home values tank in recent years should include the “quick sale” value of the home—which is roughly 80% of the value that the home is currently appraised at.  If that value is substantially below your outstanding mortgage, it can increase your aid package.
After you have exhausted all your Federal Loan options, you should look to supplement you tuition expenses with cheap Private Student Loans.And for those that have already graduated, you may want to consider refinancing some of your more expensive Private Student Loans with a Private Student Loan Consolidation.

Student Loan rates are about to double?

According to a recent article from the Huffington Post, tuition rates at four-year colleges and universities have risen over 32 percent in the last decade, and last year Americans took out more than $100 billion in student loans for the first time in our history. Student loan debt now exceeds credit card debt in the United States, creating an immense burden that will last years after graduation.

The problem will only get worse if Congress does not act soon. On July 1, 2012, student loan rates on subsidized Stafford student loans — one of the few programs that is affordable for students and families — will double, from 3.4 to 6.8 percent. In no uncertain terms, this would be another hit to middle-class and working-families, and a de facto tax increase on as many as 10 million people.

According to the non-partisan U.S. Public Interest Research Groups (PIRG), if Congress does nothing, borrowers taking out the maximum $23,000 in subsidized student loans will see their interest balloon by an estimated $5,000 over a 10-year repayment period and $11,000 over a 20-year repayment period.

Making college more affordable is one of the best investments our nation can make in America’s economic future.  Call/write your Congressman!

Student Loan Debtors

The Project on Student Debt’s report included a list of schools with the highest student loan debtors. Students of the private schools listed below graduated with debt ranging from $40,400 to $55,250. public universities that produce graduates with the most debt. The public school debt ranged from $29,800 to $45,350.


That’s mind boggling!

Got Student Loans?

There’s been a lot of talk out there about the mounds of student loan debt recently graduates are dealing with.  If you are sitting with high variable interest rate private student loans or high fixed rate private student loans, you should do yourself a favor and at least look into what your options are- A private student loan consolidation may be able to lower your fee, provide one monthly payment, give you temporary relief with an interest only option, etc…If you can avoid it, do not extend the payment years, you will end up owing more over the life of the loan.

Calling all Graduates

Calling all Graduates!
Did you get your first round of private student loan bills in the mail? How many checks did you have to write? Are you paying too much?

Well, we certainly think we can help.If you are looking for a competitive interest rate and the ability to consolidate all of you private student loans, what are you waiting for? With no hard sell and no obligation to take out a Private Student Loan Consolidation, you owe it to yourself to see if it makes sense for you.

Still unsure, check out the Private Student Loan Consolidation Calculator, which helps you better understand your potential savings and whether or not consolidation is the right choice for you.


New Private Student Loan Consolidation Calculator

A new feature on the Cedar Education website, the Private Student Loan Consolidation Calculator helps applicants better understand their potential savings and whether or not consolidation is the right choice for them. The calculator uses an applicant’s remaining loan balance and existing monthly payments to estimate the impact of a private consolidation loan on their monthly finances.

Cedar Education’s website allows you to calculate both your private and federal student loan refinance options for all of your student loan needs.

New Website Design- Cedar Education Lending

Well, it’s official Cedar Education Lending has a new site design. We hope that our investment will help make it even easier to acquire private student loans and private student loan consolidations from Cedar Education Lending.

Our mission is to offer private funding options to students currently pursuing a degree, as well as recent primary or postsecondary graduates to supplement Federal Loan programs. Our private student loans offer competitive rates as well as attractive borrower benefits.

Please contact us today!