NationStates Jolt Archive

I have no idea about how loans work except about interest rates (and even then I the only thing I know is paying a percentage of what I've taken out, not even of when or how). So could someone explain to me how loans work? And anything on student loans would also help.

First they lure you in with wonderful promises, then they own you for life.

Nobody really understands them.

you pay it back with interest until its paid off.

if you miss a payment you also pay a penalty.

if it is a secured loan--car, house, etc--if you dont pay they take whatever the security was. if the security doesnt pay off the loan you still owe the rest.

what's to know? terms vary from loan to loan and lender to lender so you have to do your homework.

I have no idea about how loans work except about interest rates (and even then I the only thing I know is paying a percentage of what I've taken out, not even of when or how). So could someone explain to me how loans work? And anything on student loans would also help.

Your question is a bit too general. For one thing, it depends on what kind of loans you are talking about.

Re student loans specifically:
http://www.salliemae.com/
http://www.finaid.org/loans/
http://www.ed.gov/offices/OSFAP/DirectLoan/student.html
http://www.myrichuncle.com/HowLoansWork.aspx

you pay it back with interest until its paid off.

if you miss a payment you also pay a penalty.

if it is a secured loan--car, house, etc--if you dont pay they take whatever the security was. if the security doesnt pay off the loan you still owe the rest.

what's to know? terms vary from loan to loan and lender to lender so you have to do your homework.



Your question is a bit too general. For one thing, it depends on what kind of loans you are talking about.


I've really only heard about student loans, which I want to know more about. I also want to know more business loans. This is really unfamiliar territory for me. Thanks for the links, btw.

If you don't pay back your school loans, eventually they get annoyed.

*eyes ACS envelope*

*sighs*

First they lure you in with wonderful promises, then they own you for life.

Loans are the modern day enslavement if used in excess and in a dumb manner. Even used correctly they can still enslave you. They are evil I say!

If you really want to stick it to the man I suggest this method. Fill out as many college credit cards as possible. Charge your tuition, books, bar tabs on them. After you are done file bankruptcy. Claim you can't find a job with your History degree. After a couple years your credit will return to some normality and after seven all signs will be gone.


Free education!

If you really want to stick it to the man I suggest this method. Fill out as many college credit cards as possible. Charge your tuition, books, bar tabs on them. After you are done file bankruptcy. Claim you can't find a job with your History degree. After a couple years your credit will return to some normality and after seven all signs will be gone.


Free education!

Getting called up at all hours of the night by debt collectors?

Getting called up at all hours of the night by debt collectors?

Nah, in the US once one files you cannot be harrassed anymore.

You borrow money and pay it back in a series of payments over the term of the loan. Loan payments are pretty straightforward, using some pretty simple formulas to calculate the amount of each payment. Depending on the loan, the interest rate might be fixed or variable which will affect the size of each payment (although not the repayment period). Some loans are deferred, such as student loans; you usually get six months after graduation to repay them, and can apply for extensions on that period should there be reason to grant such an extension. Things like grad school, IIRC, will defer repayment until after completion as well as open up additional credit; that being said, it's something you need to check with a loan adviser since I'm by no means an expert in the field. Accounting gives me a good feel for how loans work and how to account for them, but not the law around them.

A word of advice: always make sure your graduation date is set properly. I had a problem where my credit hours inaccurately showed I would be graduating a year before I actually am, so I was getting messages regarding repayment even though I was far from actually graduating.

Let's just say filing for bankruptcy will screw you over to no end. They're going to take their pound of flesh even if you write off most of your debts, and if you fail the means test at the time of bankruptcy you're seriously fucked. Now, if you like not having access to any decent credit in the aftermath of the bankruptcy, go for it. I just hope you never need any decent credit terms in the seven years or so afterwards...you'd better pray everything works well, you're entirely healthy and you want to keep living in your same residence for that entire time.

Let's just say filing for bankruptcy will screw you over to no end. They're going to take their pound of flesh even if you write off most of your debts, and if you fail the means test at the time of bankruptcy you're seriously fucked. Now, if you like not having access to any decent credit in the aftermath of the bankruptcy, go for it. I just hope you never need any decent credit terms in the seven years or so afterwards...you'd better pray everything works well, you're entirely healthy and you want to keep living in your same residence for that entire time.

I was saying that toungue in cheek. I dont recommend doing that course of action.

One can clearly set themselves up for the "means test" if they meant to rip off Credit companies. I have seen people bounce back from bankruptcies fairly easily. It is not the dire situation that some paint it. Is it very inconvienient? Sure. Is it a red mark that will last beyond 7 years? Hardly.