Because my local community colleges no longer accept Federal Student loans, I took a private loan out via Bank One and Chase Bank. The loan was substantial: $23,000. I signed my Note at an interest rate of 4.5% with no prepayment penalty.
One month later, when my first bill arrived, my interest rate had gone up to 9.8%! The payment due was TEN TIMES the amount that I had been told I would be paying. When I called Bank One, they said the loan had been sold to AES. I called them, and they told me that there was no cap on my interest rate and that it was going to adjust quarterly.
I asked if I could defer my payments, and the woman I spoke with told me it was too late and that I could not refinance, and could not prepay the loan in full without penalty.
I told her this was not the loan I had signed on for, and she told me that I "should have shopped around a little more".
When I asked for a signed copy of my Note agreement, all they sent me was an UNSIGNED copy of a Note Disclosure Statement (not what I asked for at all) with a breakdown of my loan payment options at an interest rate of 9.8%.
Now I am going to end up paying $60k on a $23k loan that only bought me six months of full-time classes at a community college.
I can no longer afford to take any more classes; my time is spent working to try and pay down this ridiculous loan.
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