Here's a Brief Primer on Fixed-Rate Private Student Loans

The "protections" for potential borrowers come at an even higher price. The word "protections" is more accurately "options" to pay all of which will add to the length and cost of the loan. Thiink of borrowing from the Mafia - your options include the "vig" 99% of the time.

Essentially student loans are the only consumer product with no consumer protection. Your school can lie about the product - whether itself (awards, ranking, alumni salaries/placement, value of degree... ) or your earnings with a given major. Your lender and school can both pressure you into decisions - and do. Let's face it, within a few days of registration ---- with the registrar, financial aid and loan officer - and landlord, utilities, food... well it's just not quite supportive of logic is it?

The bottom line is student loans are pretty much indentured servitude. You get a degree. You cannot escape paying both the loan AND the interest - which is compounded at slightly faster than that of Tony & Vito's Savings & Loan.

Best bet? If you are a parent, do NOT NOT NOT sign. People are now having $$$ taken from their Social Security checks because their kids lost their jobs and student loans won't believe they cannot find one. Oh and deferment/forbearance -IF you can get them - only go so long. If you get sick, lose your job, get divorced...sorry! There goes your credit record as well as the fees to collect . Did I mention that lenders farm out collections to more than one agency? And these don't talk to each other? Or the lender? So you might end up paying twice unless you do what it takes to get it in writing before you release that check. And this will take weeks of calls. And you will still get calls from the other collectors. And this issue will bounce on and off your credit reports. For years. And no one gets fined or slapped - because - again - you have NO consumer protection.

So - Before you accept that school's admission - do the math. Not just that - Go to the library or to your state's employment page. Look up how many current and future openings there are for your dream job(s). And what they pay - NOW. AND what experience/degree they require. You'll be shocked - but will get much better ideas for both school & major & experiences. Check salary.com, glassdoor.com to get reality check and comments on that job. THEN decide if that school & that major fits. Then avoid SL's. First offers are always full of them. You can negotiate. Be ok with going through on the 5 or 6 year plan. Work all through. avoid or limit student loans to bare minimum - pursue grants, work study, crowdfunding, getting a job that will pay your tuition. Start online biz. Selling body parts not all that odious by comparison. Just do not ever think you have protection - because you do not. Options - all bad- yes. Protection - no.

Anna Gregerson of CA 2:49PM November 25, 2011