But we were right.  We wrote about the effect of the credit crisis back in June, and this week, the Wall Street Journal published an article about the effects of the retreat by private-sector lenders from the educational loans market.  It goes on to give some jaw-dropping statistics to highlight how bad the problem really is.  For instance, over the past 10 years, the government grants and loans awarded to students has failed to keep up with the pace of rising tuition, so the amount of money students borrow from private lenders has increased tenfold, to $17.1 billion annually.

TENFOLD! So far, many of the big banks have stopped lending money, such as Bank of America, Citigroup, and now Wachovia Corp.  However, there are some good, low-interest loans still available through KeyBank, and Access Group has comparable rates, considering it is a non-profit organization.

WHAT THIS MEANS FOR YOU is that you should start saving even more money, in case you can’t get the full amount you need for the year.  While the govedrnment did say that they are increasing loan amounts to college juniors and seniors, from the WSJ article, we can see that what the government says doesn’t always happen.

What have you done to prepare for this?

View Zack's Profile      Subscribe via RSS