Report: Student Loans For K-12 Are On The Rise
Anyone who watched Nursery University — a documentary about the trials and tribulations of getting your toddler in the "right" pre-school — won't be surprised by this story.
Still, it's worth noting. The Wall Street Journal's Smart Money reports today that more parents are borrowing to pay for their kids' K-12 education. The whole piece is an interesting read, so we encourage you to click over. But here's how the Journal came to this conclusion:
"Though data is scarce, private school experts and the small number of lenders who provide loans for kindergarten through 12th grade say pre-college loans are becoming more popular. Your Tuition Solution, one of the largest lenders in this space, says demand for the upcoming year is already up: This month, the total dollar amount of loans families requested rose 10% compared to a year ago; at that pace, the company expects its total funding to rise to $20 million for 2012-13. Separately, First Marblehead, which exited the market in 2008, reentered last year as demand for loans began to rise.
"Much of this demand is coming from high-income families. Roughly 20% of families that applied for aid to pay for their children's kindergarten through 12th grade private school education had incomes of $150,000 or more, according to 2010-11 data, the latest from the National Association of Independent Schools. That's up from just 6% in 2002-03. Those who don't get approved for free aid, like grants, increasingly turn to loans, experts say."
The Journal spoke to some parents who said they do this because they believe a better grade school education will put their kids on a path to a better college.