How can people make payments for 20 years on school loans and barely make a dent in the principal? How are those loans different than a mortgage?

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How can people make payments for 20 years on school loans and barely make a dent in the principal? How are those loans different than a mortgage?

In: Economics

21 Answers

Anonymous 0 Comments

I don’t know why nobody has said this yet, but student loans tend to have much higher interest rates than most homes. Many people with homes took advantage of 2-3% mortgages. Many student loans are 6-8%. You also can’t refinance a student loan to get a lower interest rate. Or get a renter or roommate to help you pay.
You also need to pay a student loan WHILE paying for your mortgage / rent, too. Whereas many people paying mortgages may be paying it as a main payment and not have other debts.

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