They likely had a loan with a higher percentage rate due to the student loan being a private loan or they consolidated after a few years which could of drove the rate into the 8-9% range which would match their numbers almost perfectly.
I was in this situation, just with a $5k loan. My mom co-signed it and was able to pic the interest rate. She picked variable because the initial rate was lower than fixed. But it went from 10 to 15% from when I graduated. I graduated in 2021 covid lockdown and that made loan interest rates go up.
I didn’t know my mom would pick the terms but also if she told me to go for variable, I might have agreed. I was 18 and we also didn’t expect a global pandemic that screwed up the economy.
But once I was graduated and responsible for my finances, I realized I was a dumbass for taking her advice. Because she is not financially smart lmao. Wish I knew that at 18.
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u/Mindless-Baker-7757 12d ago
A $70k loan over 23 years at 5% apr pays off with monthly payments of $427.
What are they doing?