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Financing Your MBA

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Re: Financing Your MBA [#permalink] New post 24 Apr 2012, 13:24
mdesamero wrote:
I need some advice.

I have about $30k sitting in an open mutual fund. It's not in a Roth or traditional IRA, or even a 529 plan.

My question is should I cash it out prior to starting my MBA (taking out loans to cover the rest) or wait to cash it out until AFTER I graduate and finance my MBA with all loans?


That's for retirement, I'd say take out the loans for the first year, and then re-assess your situation if you want to cash that out in order to limit loan debt.
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Re: Financing Your MBA [#permalink] New post 24 Apr 2012, 18:52
I have about 25k in outstanding loans from undergrad but am enrolling in an MBA program this fall. does anyone know if lenders are willing to stop/lower interest while I am at school? obviously I will have no/limited income other than my internship while I am attending.

any help or advice is greatly appreciated, and apologies if we've hit on this topic before!
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Re: Financing Your MBA [#permalink] New post 27 Apr 2012, 13:16
tjb822 wrote:
I have about 25k in outstanding loans from undergrad but am enrolling in an MBA program this fall. does anyone know if lenders are willing to stop/lower interest while I am at school? obviously I will have no/limited income other than my internship while I am attending.

any help or advice is greatly appreciated, and apologies if we've hit on this topic before!


Once interest starts accruing on your loans, it continues to accrue indefinitely until you pay them off. So you may not have to pay your loans while in school, but interest continues to accrue on your undergrad loans. This is definitely the case w/ Federal loans, and is almost always the case with private loans (aka Sallie Mae, etc.)
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Re: Financing Your MBA [#permalink] New post 14 Jul 2012, 04:01
Three main things to consider when looking for financial aid:

- Grants and scholarships
- Corporate sponsorship
- Loan

There's a useful article on the Global MBA Report website (I think it's in their Admissions/GMAT section?), which gives some guidance and useful links on how to research the above options. It also shows MBA programs ranked by 'Value for Money'!

Personally I'm getting a loan from the Bank of Mum & Dad!!!
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Re: Financing Your MBA [#permalink] New post 30 Jul 2012, 23:08
thanks for sharing this info.
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Re: Financing Your MBA [#permalink] New post 12 Aug 2012, 10:13
mdesamero wrote:
I need some advice.

I have about $30k sitting in an open mutual fund. It's not in a Roth or traditional IRA, or even a 529 plan.

My question is should I cash it out prior to starting my MBA (taking out loans to cover the rest) or wait to cash it out until AFTER I graduate and finance my MBA with all loans?


Have you decided what you're going to do? I'm debating what to do with my money for next year. I've shifted to putting money into a savings account instead of the stock market since I'll be using it shortly for school. I just can't decide what to do with some of my long-term stock holdings and savings when I actually start school. I don't like taking on more debt than I have to but I feel like I'm better off taking a little more loans than I think necessary and holding the cash as a just in case. My wife will be working full time so that will help but she has grad school loans of her own we will need to be paying off so I can't count too much on her salary supporting us a whole lot. Especially if I end up in a big city like NYC or Chicago.
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Re: Financing Your MBA [#permalink] New post 11 Jan 2013, 01:05
Hi I am an Indian thinking about doing MBA in US . I have a few questions which are making me kind of tense . Can you please help me answer them .

What is the current scene for Indian Students studying in (M7 +Next 8) Business Schools in US?Are they able to get good jobs after MBA ?How much role does Visa sponsoring play in final FT Recruiting for Indians there who doesn't have work permit/green card ?Is the competition tough for foreign graduates (~around 40% of the class I guess ) as the firms may have limited quota for foreign students.
How are the job prospects for MBA graduates in the current market ?(for foriegn students especially )

I am planning on my MBA and I was shortlisting schools .I would like to know your honest opinion on this.Is it worth taking 100k + loan and apply to US MBA schools.I don't have that kind of money but I am willing to take risk if it really worth?
and approximately in How much time an average MBA graduate is able to repay that loan .
THANKS for your help answers in advance :)
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Re: Financing Your MBA [#permalink] New post 15 Jan 2013, 04:14
Hi all,

Not sure if anyone can help me, but I'm looking at funding options. I'm from South Africa. I have a co-signer, but they're Canadian, not American. Do you know of any US banks that would give loans with Canadian co-signers?

Thanks
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Re: Financing Your MBA [#permalink] New post 15 Jan 2013, 08:08
not sure if this is representative. i am trying to get a private loan from Sallie Mae and they said they don't accept applications until 2 months prior to disbursement? my plan is to take advantage of the low interest rates and get a variable loan for the first year. if rates skyrocket, i'll prepay the most i can and switch to the stafford loan my second year.
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Re: Financing Your MBA [#permalink] New post 18 Jan 2013, 15:25
This thread is amazing.. I highly recommend reading through from the first post to the end.. very educational.

A private vs public loan question:

For people who have no intention of working in the government and are confident in job prospects, are there any other reasons for getting a public loan over a private one? I'm curious because rates for fixed private loans with cosigner seem lower than Stafford or Grad PLUS..
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Re: Financing Your MBA [#permalink] New post 24 Mar 2013, 17:35
Moodyz wrote:
This thread is amazing.. I highly recommend reading through from the first post to the end.. very educational.

A private vs public loan question:

For people who have no intention of working in the government and are confident in job prospects, are there any other reasons for getting a public loan over a private one? I'm curious because rates for fixed private loans with cosigner seem lower than Stafford or Grad PLUS..


Private loans can have variable rates. So while it might be low now, it can skyrocket later. The Direct and Grad Plus have fixed rates.


hotelganpati256 wrote:
Just considering the price of an MBA is enough to give you a situation of angina. But before you start looking for your insurance plan cards and contacting 911, keep in mind that this is an economical commitment in your upcoming, an economical commitment that should educate you the program of determining an ROI (return-on-investment), which is almost certainly beneficial.

Funding for an MBA can come from a wide range of sources. The most genuine ones are economical aid/loans—federal and private; individual benefits, allows and fellowships, and work-study roles. The most impractical sources of money? Highly-paid part-time perform, that really wealthy dad, on-line online texas holdem, day dealing, and core dealing (we’re joking, of course).

And while everyone has to determine how to pay, there is no worldwide strategy. This aspect of MBA preparing is exclusive to you. Your sources, university, citizenship, and record of credit will all perform significant tasks in interpreting your transaction strategy.
------------------------------------------------------------------------------



Weird, the above post is 100% copied and pasted from a book, Case Studies and Cocktails.
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Re: Financing Your MBA [#permalink] New post 26 Mar 2013, 17:23
pancaketown wrote:



Weird, the above post is 100% copied and pasted from a book, Case Studies and Cocktails.


Thanks for the heads up.
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Re: Financing Your MBA [#permalink] New post 26 Mar 2013, 20:24
Can someone comment on this plan?

I live in CT and have not purchased any 529. They have a 1-1 deduction up to 5k. I am planning on going to school in September. Is it possible to fund my 529 this year and then just withdraw it the same year? (I would probably withdraw the same day, so there is no investment risk)

i could do this for 2 years, and save 600-700 in CT income tax
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Re: Financing Your MBA [#permalink] New post 27 Mar 2013, 05:12
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Jumping back into this thread nearly 2 years after I came up with my plan. Graduation is around the corner and I'm looking ahead to the debt service payments I'll be making later this year. Thought this might be helpful to people making decisions about financing school both before and after attending.

I took out about $100k from Sallie Mae at 2% (variable) with half amortized over 7 years and half over 10. I have no clue why I took out a 7 year loan, but that's in the past. Monthly Payment for the 2 loans is about $1,200.

Also took out $40k at 6.8% (Stafford) and $10k at 7.9% (PLUS) all amortized over 10 years. Payment due is about $600.

So, I'm looking at nearly $1,800 a month. Probably more than I realized 2 years ago, but I was also in a different place in life. Like nearly all other second year students, my wife and I are expecting a child soon and can't count on her income as a sure thing to help service the debt. Plus, BSchool is way more expensive than the Estimated Cost of Attendance figures schools provide and we tapped more savings than expected. Most of the expenses, for us at least, seem to come from the social nature of school. Dinners out with other couples, rounds of golf, travel... Part of it is probably that it's difficult to go back into "college mode" when you are 30 years old and have become accustomed to a certain lifestyle (cars, apartments, Whole Foods).

I'm looking to refinance the loans to lower my monthly payments until cash flow improves:

The federal loans are somewhat straightforward. I plan to lengthen the term to the maximum of 25 years. There is no prepayment penalty, so once my salary increases and a few bonuses come I'll make a bullet payment. Some friends would prefer to pay this down as quickly as possible because of the high interest, but I value the improved cash flow at this time. In hindsight, I wish I had taken all (certainly more) out in federal loans because it is so much easier to adjust monthly payments through longer terms, IBR (which I don't think many MBAs would qualify for) and graduated payments. Amortized over 25 years, public loans will run closer to $350 a month.

Private Loans are a bit trickier because fewer options exist. Sallie Mae will not consolidate or refinance the loans. Best I can tell is Wells Fargo at about 3.25% (tied to PRIME somehow) with a 15 or 20 year term. Can't tell from the web, I'd have to actually apply. Consolidating with Wells at the current rate over 15 years gets me down closer to $750 a month.

Total monthly payments after consolidation will run about $1,100 a month. Nearly $700 per month less.

I hope this helps everyone put the cost of BSchool into some perspective with real numbers. If you have any thoughts about my plans, especially if you think this is a bad idea, please let me know.
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Re: Financing Your MBA [#permalink] New post 25 Apr 2013, 14:28
Hi All,

I am not seeing anything addressing a particular problem I am having with the student loan process so I am hoping someone on this thread may have some knowledge. My tuition and mandatory fees are going to be covered by my parents but I will need to take out loans the cover the rest. Most of the student loans I am seeing disburse to the school you are attending and then the office of financial aid hands over the amount of money that remains after tuition fees etc have been deducted. Having spoken with a Columbia Business School Financial Aid Officer briefly they indicated that they are obligated to subtract the tuition first and then disburse the loans even if the tuition has already been paid.

For tax reasons my parents have to pay the school tuition directly or else the money given to me or paid off on my loan is subject to a gift tax on them or income tax for me. Has anyone else had this type of situation and if so what was the solution? Were you able to get a private lender to disburse a student loan directly to you or work something out with the financial aid office at your school?

Thanks!
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Re: Financing Your MBA [#permalink] New post 25 Apr 2013, 16:30
any data about Canada ? what are the options for financing an MBA in Canada?
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Re: Financing Your MBA [#permalink] New post 26 Apr 2013, 08:42
lilmisskate86 wrote:
Hi All,

I am not seeing anything addressing a particular problem I am having with the student loan process so I am hoping someone on this thread may have some knowledge. My tuition and mandatory fees are going to be covered by my parents but I will need to take out loans the cover the rest. Most of the student loans I am seeing disburse to the school you are attending and then the office of financial aid hands over the amount of money that remains after tuition fees etc have been deducted. Having spoken with a Columbia Business School Financial Aid Officer briefly they indicated that they are obligated to subtract the tuition first and then disburse the loans even if the tuition has already been paid.

For tax reasons my parents have to pay the school tuition directly or else the money given to me or paid off on my loan is subject to a gift tax on them or income tax for me. Has anyone else had this type of situation and if so what was the solution? Were you able to get a private lender to disburse a student loan directly to you or work something out with the financial aid office at your school?

Thanks!


lilmisskate86 - are you repaying your folks after all of this? If so, you can structure this as a loan with an absurdly low interest rate (not like they're high right now anyways). That way instead of the paying a gift tax or losing out on financial aid, you get the maximum value of your debt and get to take a tax deduction for interest and school tuition payments.

If they're just paying tuition and mandatory fees, then I'm incredibly jealous :). One way to deal with that may be to set up a trust with you and your siblings as beneficiaries, although this will also effect how the school views your assets and may be subject to the same tax (I'm unclear about this). Regardless, see you next fall at CBS.
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Re: Financing Your MBA [#permalink] New post 26 Apr 2013, 12:55
Have any Americans started shopping around for private loans? What are the popular lenders offering the best rates? Sallie Mae looks pretty good right now.

Is there some sort of search engine or comparison tool for this type of thing?
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Re: Financing Your MBA [#permalink] New post 30 Apr 2013, 18:04
Similar to the last question - just curious if any other Americans have priced out private loans? If I can get a 2-3% interest rate loan from Sallie Mae I am totally rocking that.

Unfortunately, I didn't receive any scholarship money but I have excellent credit and quite a bit saved up (enough to pay for my entire two years). Maybe it's the inner financial geek speaking :-D, but I would totally finance my education at ~3% since I'm pretty confident that the return on my investments will be above that. I can always payoff the loan in full immediately if interest rates skyrocket.
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Re: Financing Your MBA [#permalink] New post 01 May 2013, 07:55
Discover Financial and Wells Fargo have competitive rates. I have excellent credit and my parents offered to co-sign, so based on what I've seen it's definitely worth it for me to mix in a healthy amount of private variable-rate with the fixed government. I'm of the opinion that rates are going to remain low for the next few years, at minimum.
Re: Financing Your MBA   [#permalink] 01 May 2013, 07:55
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