Students should be mindful of loan debts
Dave Reeder can always count on it.
It is the face some college seniors make during their exit interview with Mount St. Mary’s University’s director of financial aid office and his staff. Mr. Reeder’s office is required to meet with any graduating students on the Emmitsburg campus who have federal loan debts.
Within six months, the students will need to start paying off the thousands of dollars that have come through those loans.
“I think for many of them, it’s not a reality until they sit down for their exit interview,” Mr. Reeder said. “As you sit down, you realize quickly the ones that are not aware.”
The students about to enter the workforce are currently being told in their interviews they face a reality of paying off loans for years and perhaps decades.
Even though the loans have likely been tremendous help throughout their academic studies, loan types like “Perkins” and “Stafford” are only just now becoming familiar terms for students.
“The biggest idea we try to get across to them is that you are leaving here with more than one loan. Once they leave here, they have multiple loans to pay back,” Mr. Reeder said.
Nationally, President Barack Obama has proposed a massive shift in the student loan payment programs. According to a Washington Post story, the administration is hoping to end the 16-year window that government programs have provided student assistance.
Under the new plan, the Education Department would make direct loans to students, said the Post.
Mr. Reeder said one of his office’s biggest goals is educating potential students and their families before they enter school about the loans they choose to accept.
“We certainly try to encourage more communication between parents and students,” Mr. Reeder said. “Parents are a little more aware of the loans. We have students every year who are not aware they have borrowed at all because they were following mom and dad’s instructions. We hope there is communication between the parents and students.”
Students are encouraged to find jobs as soon as possible so they can be prepared for payments months after graduation. Mount students are also told about deferment possibilities if there is financial difficulty or if they choose to return to school.
“With everything that has gone on in our society, there is a much bigger appreciation for the levels of debt,” Mr. Reeder said. “At the end of the day, they have to make the decision about the ultimate worth of the debt. I think the value of an education is significant enough to do that.”