South Texas College of Law Annotations (Houston, Tex.), Vol. 40, No. 4, Ed. 1, February, 2008 Page: 1 of 8
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The Student Newspaper of South Texas College of Law
ANNOTATIONS
February 2008
Volume XXXX, Number 4
Lower Interest Rates Might Help Graduates
By Anil Ali
Staff Writer
As most students know, Sallie
Mae is the main student loan
provider because they offered the
cheapest rates; but now that Sallie
Mae's stock has fallen down to
about $20 a share from its high of
$58 earlier, what will it mean for
students? Will it mean that Sallie
Mae will try to recoup its losses
that were brought on by the
housing industry from students, or
will the latest action by the
Federal Reserve actually reduce
student loans?
Nearly a year ago, a USA
Today article by Sandra Block,
Kathy Chu and Mary Beth
Marklein reported that Sallie Mae
agreed to pay $2 million dollars
in a settlement with the attorney
general of New York. Sallie Mae
stated also that it would stop
compensating financial aid
officials with perks as well as
operating calling centers that
make it seem like it is university
affiliated. The money collected
will be used to help students and
parents realize the potential
impacts of loans. According to
some estimates in the same
article, the rates of student loans
increase by hundreds of dollars
from these types of arrangements
which is a bad sign for students.
Disregarding any corporate
wrongdoing, the financial news is
looking good. The Federal
Reserve has been cutting interest
rates by significant portions. It is
expected that the Federal Reserve
will cut rates once more at the end
of February or sometime in
March. This news has been
rallying the stock market, but the
question becomes what will it
mean for a bulky law school loan?
Students are hoping for a
trickle down effect on their loans
triggered by the FED's move.
Currently, the Federal Stafford
Loans are fixed at 6.8%, and
nothing can be done about this
percentage at the moment. The
Financial aid department at South
Texas has noted, "Financial aid is
[sic] questionable [at the] time for
many lenders and unfortunately
right now the business is rocky.
Some lenders are getting out of
the business altogether, and others
are making adjustments to
continue serving borrowers."
Although there can not be
much done about lowering the
6.8% loans that most students
have taken, things are different
once a student graduates.
Students are eligible to
consolidate their loans once they
graduate (or drop out of school
completely). This will mean that
graduating 3L's will have some
opportunity to get their loans
subsidized and pay a lower
percentage.
The Federal Reserve has been
auctioning money in the economy
at about 3%; therefore, students
will likely be able to find
consolidation somewhere
between 3% and 6% to whoever
bids the lowest price. For more
information about consolidation,
seek the help of a financial aid
representative or the internet.
Rates have become very low
compared to historical figures, so
each graduate should keep this in
mind while searching for a
competent and trustworthy lender
with which to consolidate.
Also, while considering
consolidation, it is important to be
aware of what repayment benefits
exist that will work best for
students. Additionally, some
benefits may be lost with current
lenders if a student chooses that
path. So any financial advisor will
warn a student to ask whether it
is worth consolidating because the
interest rates are currently fixed
on their loans and some loans
provide grace periods; therefore,
a student should not switch
lenders unless there is a clear
benefit with lower rates.
Be financially safe out there
and do your homework before
doing anything.
Another Perspective Valentines Day Brings Activities
By Anne Clausen
Guest Writer
Have you ever struggled with a case brief or fumbled though a
recitation and thought to yourself that there simply must be another
way to learn the law? Well, you were right. Actually, there is a law
school where they never call on you during class, and you are never
asked to recite a case. They also never check if you actually attend
class. No roll is ever passed during class, and the professors, for
that matter, couldn't care less if you show up or not. Imagine all
the uninterrupted games of solitaire played at this school! In
addition, of course, the fact that you don't really have to prepare
for class since your professors will never notice if you're prepared
or not. Every semester five or six essay questions are put on the
internet for those who want to practice their essay skills before
their exam; but it is entirely up to you whether you want to do it or
not. Last but not least, (some would probably say it was the most
important): There are no tuition fees at this school. Actually, all
education in the entire country from elementary school to university
is free. To further encourage people to get an education, the state
actually gives each student a monthly bursary of 850 dollars (for a
maximum of six years) just to be "an active student." Sound too
good to be true? Actually, I just described the law school that I
have attended for the past three and a half years, the law school at
University of Aarhus in Denmark.
As an exchange student at STCL, I go about in a constant state
of surprise and amusement. Even small things baffle someone who
is used to something completely different. Passing the roll for
instance—why is it necessary? Would anyone actually pay all that
money to go to law school and then not show up? And if they didn't
continued on pg. 2
South Texas College of Law was a busy place during Valentines
Week. Several student groups, such as the Animal Law Society,
scheduled fundraisersfor that week. Photo by Jessica Crawford.
What's Inside
District Attorney Forum, pg. 7
Downtown Living, pg. 2
Day of Giving, pg. 3
#
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Lewis, Tamara E. South Texas College of Law Annotations (Houston, Tex.), Vol. 40, No. 4, Ed. 1, February, 2008, newspaper, February 2008; Houston, Texas. (https://texashistory.unt.edu/ark:/67531/metapth144587/m1/1/: accessed April 24, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting South Texas College of Law.