If you can't afford mortgage, don't borrow to send kid to college

When I can't think of anything else to write about, I sometimes like to pick up a copy of US News & World Report's America's Best Colleges, and spend about 30 seconds flipping through to find one piece of really, really, really horrible advice.

And so here it is, from an article by Kim Clark:

The federally backed parent PLUS loan can cover the student's entire cost of college (less any other financial aid). But PLUS loans can cost as much as 8.5 percent a year plus a fee of 4 percent of the loan amount, for a total annual percentage rate of as much as 9.4 percent. Shoppers can find discounts, however. Those who borrow directly from the federal government and make automatic electronic payments are charged just 7.65 percent in interest. (After fees, the APR totals 8.55 percent.) And the eligibility criteria are comparatively forgiving, even for parents who are a little behind on their mortgages.

Here's a good rule of thumb to remember: If you are "a little behind" on your mortgage, you should not even contemplate considering giving thought to the possibility of perhaps doing some research into whether it might be a good idea to possibly borrow money to pay for college.

Seriously: if you can't afford your mortgage payment, you have absolutely no business racking up further monthly payment obligations. Your kid needs to go to a cheaper school, get a job at WalMart, and sell his video games on eBay (since he won't have time to play them anymore, what with the WalMart job).

Please, please, please: if you can't afford your mortgage payments, don't take out additional debt to pay for college. And before you go ahead and encourage your kid to sign up for loans on his own, consider the negative effects that borrowing may have had on your own financial situation and life.
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