How Not to Get “Ripped Off” by a Lender | 05.10.10
Here is a complaint we hear all the time in our Financial Aid Forums and elsewhere on the site: “I took out a private student loan from Lender X. Now they are trying to steal money from me! I am being ripped off!” The fact of the matter is, it’s not in the best interest of loan companies to “steal money” and “rip off” a customer. Often, the problem between a borrower and lender stems from a simple miscommunication.
Here are some ways to avoid the drama that comes from fighting with a lender:
1. Before you take out a loan, do a little research. Look for online reviews and forum postings detailing experiences with lenders. If there are far more negative reviews than positive reviews, take it with a grain of salt. A large majority of people just go online to complain about things, and very few take the time to tell you how awesome their bank is.
With that said, look for overriding themes about each lender, namely customer service, extra fees, etc.
2. Find the loan that fits you. Taking out a private student loan is a big decision, and you should be very diligent about finding the right one. We recently unveiled a private loan comparison tool that lets you browse from a series of reputable lenders. It’s a bad idea for a consumer to take the first offer, so don’t be afraid to shop around.
3. Use a co-signer. Chances are, you will need a co-signer anyway to take out a private student loan. One of the advantages of a co-signer, aside from their ability to assist you in getting the loan, is that you can share knowledge about the loan.
4. Read the fine print. Pay particular attentions to penalties, fees, deadlines, or any other factors that could affect your interest rate.
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Does anybody knows who oversees that financial institutions do not screw students? I am now paying my student loan, AES just got my loan by the end of Jan. 2011, my prior lender got a direct deposit on Jan 20, 2011 and AES took my account on Jan. 28, 2011. AES still expects a Jan 2011 payment, which does not make sense since I already paid my prior lender. AES took me off the reduced interest rate program because my prior lender returned their the money a month later. How was I suppossed to know, that my prior lender was selling my loan to AES? I learned about it after my prior lender had been paid for the month of Jan 2011. It just does not make sense!
Awesome ideas!
good to know
interesting
THESE ARE SOME VERY GOOD IDEAS EVEN THOUGH I NEVER THOUGHT OF DOING ANYTHING LIKE THAT
This is a very tough decision to make, because we must consider the time frame to pay the loan, and if at that time we have no money to pay we must re-loan to cover the first loan and so on.
Wow this is good to know but alittle frightening
Read the fine print, always! I definitely learned some useful information from this
I would not want to borrow. You would never know what would happen. I would suggest that people should try to save up money for college and try out for as many scholarships as possible.
pooooints
Borrowing loans is a major decision. I would advise everyone to decide on a major and graduate from college asap to avoid accumulation of debts.
I agree… taking out a loan is a huge responsibility and like you say… its a major decision. People should always think it through.
yea, ive heard or some meny make those kinds of decishions and regreting it later
Definitely read the fine print. Mine stated that they can discontinue the contract at any time for any reason. So if they sell out to a different banking/loan company then the new company does not have to honor the contract. Also they can alter interest gradually without notification: ALWAYS read the entirety of the paperwork. If you don't understand you should ask someone.
i wish there were more informative things out their for a freshman in college about loans.
Yea you dont have to borrow if you get enough scholarships.
this is scary.! ill keep my interest in federal scholarships and grants
I think everyone is afraid to borrow because you are letting someone else play with your money. I have never had this happened just like the person above.
This really shocks me. I've not had to borrow from a private lender Praise God,
I've just received Stafford Loans but I do feel sorry anyone who has been ripped off. If so, I think I would get legal advise if needed.
But 1st do as this article states – check 'em out!!