There’s been a great deal of press in recent years about the impact student loans have on the larger economy, especially home purchasing. A Federal Reserve Bank of New York report showed a decline of 8 percentage points in home ownership among 28-to-30-year-olds from 2007 to 2015, and estimated that about 1/3 of that can be attributed to student loan debt. Because that’s all a little abstract, and because decisions families make now about college and student loans have the potential to cast a long shadow on the student’s life, I asked mortgage broker Tim McBratney of Pacific Residential Mortgage to explain how student loans affect the mortgage qualification process. He notes that the process has gotten more difficult with respect to student loan debt. Continue reading Student Loans and Mortgages
Most schools lump tuition and fees into a single line item on their costs, but students and parents should have visibility to which is which. It can take a little bit of digging to find out, though.
First, what are fees? They can be anything from health insurance to fitness center costs Continue reading Tuition & Fees
The Federal Reserve Board of Governor’s Report on the Economic Well-Being of US Households has a wealth of data on student loans, including a breakdown of borrowing by age range, forms of debt, and payment status by school type. Some interesting points: Continue reading Trends in Education Borrowing
One of the big changes to the tax bill was making our young adult children less valuable to their parents from a tax perspective. The dependent exemption is gone and the child tax credit for 18- to 23-year-old dependents is only $500. The change does open a door to higher-income families for the American Opportunity Tax Credit, though. The AOTC phases out at MAGI of $160,000, so it’s not unusual for families to be ineligible but to still find college unaffordable.
Here’s how the AOTC works, from irs.gov: Continue reading AOTC And New Tax Law