You’ve probably done a great work raising your child given that he or she is ready to go to college. Yet, as much as you are looking forward to this period of their lives, you are also probably dreading it at least a little bit, given the financial side of it all. To put it bluntly, colleges are expensive, and nobody can deny that fact. Well, your child can always take out a loan, as explained here, and go through their education process that way.
If you are like most other parents, though, you will feel at least a little bit worried about the idea of letting your child take on a loan at such a young age. Sure, it could be a good thing, as it will teach your children financial responsibility and help them learn how to take care of themselves in a certain way. On the other hand, though, it can put them into a rather difficult position, since they are basically beginning their lives, and you probably don’t want them to start on their path with a huge debt hanging over their heads.
Well, if that’s how you are feeling, then you need to ask yourself one thing. What are your options? Should you just have your child sit at home or find a job without going to college even though they were really looking forward to it? Or, should you let them take out a loan and spend a lot of time repaying it after finishing the college that they are going to attend? I suppose that those two options sound equally dreadful to you.
Is there, however, another one? Luckily for you, and for every other parent these days, there seems to be a different option that can help you feel at ease, knowing that your child won’t enter adulthood in debt. That’s the option of you, a parent, taking out a loan and assuming responsibility for repaying it, while your child can comfortably enjoy his or her college experience without having to worry about money too much.
Here’s some more info about one type of parent loans you should know of: https://loans.usnews.com/articles/everything-you-need-to-know-about-parent-plus-loans
What Are Parent Loans?
Now, before you get to the point of deciding if you want to get a parent loan or not, you will undeniably want to learn exactly what those are and how they work. After all, you should never rush into any financial decision without first getting properly informed and thinking things through. I suppose you understand that already and there is no doubt in my mind that you are ready to learn about this entire concept of parent loans before actually making any final decisions.
So, let us start with the very basics here. A parent loan is, as the name says it, a loan that a parent or a guardian takes out in order to help a child pay for school, i.e. for college in this particular case. It can cover education related costs such as tuition, board, supplies and similar things. The difference between these and the loans that are taken out directly by students lies in the fact that the parent loans are entirely in the guardian’s name.
That basically means that the guardian is taking full responsibility for repaying the money that they’ve borrowed, together with the interest. So, if you decide to do this, you’ll be the one who’ll need to repay everything in a timely manner and you’ll be held responsible for any types of delays. Your child, on the other hand, will entre adulthood without any debts, which can certainly be a good motivation for them.
There are two different options you can choose from if you decide to be the one that will take out a loan instead of your child. I am talking about the federal and the private options. I would advise you to learn more about both of these before you take any concrete steps towards borrowing the money. That way, you’ll understand which option you are eligible for, as well as which one might be better for you, meaning that you’ll be able to get the perfect parent loans for college and thus help your child in the educating process.
Should You Do This?
If you are now trying to decide whether doing this is a good idea or not, here is what I have to say about it. While it might not be a bad thing for your kid to take out a loan all on its own and thus learn a little bit about financial responsibility from the very beginning of his or her adulthood, I am definitely closer to the opinion that entering that adulthood debt free is a much better option. Yet, the decision is ultimately yours to make.