We are in the process of paying off school loans. After all the consolidation was said and done after graduation, I ended up with 3 different loans. One private and one government subsidized loan, and then another private loan that was technically in my dad’s name, but we had an understanding that I would make the payments. (He bailed me out in my last year of school, as I had maxed out all the private money that I could get access to). I think the total balance after 3 years at Baylor was around $70,000.
Fast forward. Just the other day, we paid off the 2nd loan – 2nd in the order of smallest to largest, à la Dave Ramsey’s baby step #2 (the debt snowball). So now we’re only staring down the barrel of ONE Sallie Mae loan. This is exciting, all things considered.
So, we are looking at one more student loan at a current payoff balance of $30,500. Here’s the kicker: I have paid on this loan since about December 2004. The other day I logged in to my account because I was curious what the payoff balance was: $30,500. Then I looked at the original principal balance. To my dismay, it was $31,200. This means, that after paying 5 1/2 years of minimum payments (approx $350 – $450 over the years), the principal balance has only come down by $700. Bottom line: minimum payments suck! I looked at my payment history and the split between principal and interest, and the principal is finally outweighing the interest. We don’t plan to keep paying the minimum on this loan since it’s our last one. We are ready to attack this one with as much intensity as we can muster up. Here we go…
Do you have school loans? Do you have an estimated payoff date them?