On average, Purdue undergraduate students are graduating with more than $23,000 worth of debt. Graduate students are dealing with more than $38,000.
Joyce Hall, Purdue?s Division of Financial Aid executive director, said students need to be careful before they take out loans, as there are many factors to consider.
?While salary upon graduation is not the only factor, it is important to know what the average starting salary is for particular employment,? she said. ?For every $10,000 borrowed, the repayment upon graduation is approximately $120 dollars a month.?
The Indiana Public Interest Research Group looked at nearly 2,000 schools and found that 62 percent of Indiana students graduated with debt.
The report also found that many students are turning to private loans to help pay for college. Such loans can carry interest rates of more than 18 percent.
Hall said although private loans are the least desirable for students, there were almost 3,000 processed at Purdue last year. The report found that 26 percent of individuals who took out a private loan didn?t even try to take out a federal Stafford loan.
?All federal sources of student loans should be exhausted before considering taking out a private loan,? Hall said. ?Federal loans have more attractive and lower interest rates than private student loans.?
Stephanie Gogul, an organizer with Indiana?s Public Interest Research Group in Bloomington, said private loans are similar to credit cards because they have high penalties and fees. Interest rates for private loans can be three times as high as federal loan rates.
?Students in Indiana and throughout the country are facing high tuition now and shaky job prospects at graduation,? she said in a press release. ?Providing strong rules for private student loan marketing and terms will provide security.?
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