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Caribbean Student Loans

10 Ways Your Caribbean Lender Is Robbing You Blind

10 Ways Caribbean Banks Are Robbing You Blind

When I signed up for a Caribbean student loan to fund my college education, I thought I made a simple agreement.

I know, now, that it was everything but a simple financial obligation, and after my own lender messed up my student loan, I identified 10 ways your Caribbean lender is (probably) robbing you blind.

Non Disclosure of Policies and Procedures

Although you signed and agreed to a promissory note for your student loan from your Caribbean lender, details on its policies for applying principal payments, the process to apply for deferment, what happens to interest that builds up during your in-school or post-graduation grace period and when you will have an opportunity to keep outstanding interest from being added to your loan’s principal balance, are not disclosed to you in writing.

The result: You lack a full understanding of what you agreed to, and your lender makes more money

Mysterious Account Transactions

When you signed up for a student loan, you expect transactions to involve disbursements of loan funds, accrual of interest, loan payments and not much else. Yet your Caribbean lenders apply mysterious fees without much explanation, set payments aside to phantom holding accounts, record disbursements you did not request, and fail to apply payments to your loan account even after the funds have cleared from your personal bank account.

The result: You pay more in interest & fees, and your lender makes more money

Not Issuing Regular Statements

Even though transactions occur on your student loan account monthly, you don’t receive regular statements. Most times, it’s impossible for you to know what the status of your loan is, whether your payments were properly applied, and you can’t even be sure if your principal balance is on an upward or downward trend.

The result: You’re confused about what you owe, and your lender makes more money

Limited Access to Account Information

You’ve tried to get up-to-date information about your account, but experience delayed responses and if your lender offers online account access, the account information is hard to discern. Getting a clear picture of what you owe in terms of outstanding principal and interest balances, or how many payments you have remaining, seems out of reach.

The result: You can’t stay on top of what’s happening on your loan account, and your lender makes more money

Outdated Methods of Payment

Because the options to pay your student loan are cumbersome, your on-time payments are delayed and show up on your account, days past the due date. Your lender’s idea of innovation is an online payment option that involves the multi-step process of downloading a form and submitting a copy of multiple forms of identification, to make a payment by credit card or by directing you to third-party bill payment platform, whose system has with varying payment delivery times.

The result: You get hit with late fees and default notices, and your lender makes more money

Losing Track of Payments

You submit your monthly payments using the options available to you, then months (or even years) down the line, when you are able to get a copy of your loan statement, you realize that multiple payments are missing or not properly applied to your account. Your loan’s principal balance, that you thought that you were chipping away at with each payment, is stagnant or reduces only slightly.

The result: You end up repaying your loan for a longer period of time, and your lender makes more money
Related Article: How I Shaved $6,000 Off My Caribbean Student Loan After Making $4,000 in Interest Only Payments

Capitalization of Interest Without Prior Notice

Capitalization of outstanding interest on your student loan has a huge impact on the total cost of the debt to you and the size of your monthly payments. Yet, your Caribbean lender fails to inform you of when it takes place, and what happens to outstanding interest after capitalization.

The result: You pay interest on top of interest, and your lender makes more money

Withholding Extra Payments

After making room in your budget to submit extra payments to pay down your student loan faster, your receipts fail to reflect how it was applied to your account. You contact your loan officer, and you are surprised to find out, that although the money for your extra has left your own personal bank account, it has never made it to your loan account.

The result: Your loan accrues more interest than it would if your extra payments were applied, and your lender makes more money

Not Warning About Interest-Only Payments

Although it’s easy to tell when your principal balance stays the same after on-time payments, it’s harder to figure out why. You are totally unaware of when your loan effectively becomes an interest-only loan and receive no warning from your Caribbean lender when your loan negatively amortizes.

The result: The total cost of your loan can potentially double over time, and your lender makes more money

Subpar Customer Service

On top of the inefficient operations of your Caribbean lender, the customer service is the worst. In order for you get a minimum level of service, you have to contact a friend of your family who works at the bank directly. Other than that, the best case scenario is to endure frustratingly long hold times, unanswered emails, and unresponsive and rude staff.

The result: You are repeatedly worked up by the low level of service, and your lender makes more money

All these practices work together to bring more profits to your Caribbean lender at your expense. Make sure to use these 7 steps to keep avoid these lender mishaps and cut the costs of your Caribbean student loan.

~Melisa Boutin

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How I Shaved $6,000 Off My Caribbean Student Loan After Making $4,000 In Interest-Only Payments

How I shaved $6,000 off of my Caribbean Student Loan After Making 4,000 in Interest Only Payments

I never expected that my monthly payments on my Caribbean student loan would go to interest only. After all, I made sure to read my promissory note and started making my required minimum monthly payments, as scheduled, 6 months after graduation. That’s why I was completely shocked to find out that almost all of first-year of payments, totaling $4,000, only to interest.

In spite of that $4,000 setback, I was still able to pay off my Caribbean student loan two years early and shave off $6,000 in payments by using these 7 steps.

1. I Made Sense of My Caribbean Student Loan

When I started my first full-time job after graduate school, I decided to take the time understand how my student loan worked, instead of just making my minimum monthly payments, without giving much more thought to what was going on with my loan account. From that point forward I wanted to be more proactive.

I requested that my lender send my statements directly to me at the US address, and not to my parent’s house in St. Kitts and reviewed my student loan statements to determine exactly how much of a principal balance I had outstanding, the annual interest rate and how many payments were remaining.

2. I Paid Attention To The Accrued Interest

After learning that how loan interest accrues, is capitalized or negative amortized, can increase the cost of my debt and the length of time it takes to pay it off, I started to pay particular attention to the interest on my own Caribbean student loan. And I honestly wished I had done so sooner.

Related Article: How My Caribbean Lender’s Dysfunction Messed Up My Student Loan

I determined what the daily interest rate factor for my student loan was, double-checked that the amount of accrued interest on my account statement matched up to my own projections and confirmed that my payments were applied to both principal and interest.

3. I Communicated With My Lender Often

Caribbean student loan lenders have a peculiar practice of providing quarterly account statements to borrowers, even though transactions are recorded monthly. This, of course, leaves borrowers in the dark about their outstanding principal and accrued interest balances and how their payments are applied to their account.

Although I could not change how often I received my statements, I made a commitment to requesting updates on my account after each payment I made, to stay informed.

Related Article: The Caribbean Development Bank Student Loan Scheme Assessment

As a borrower based in the United States, this involved spending hundreds of dollars on international calls and enduring a sometimes frustrating process or multiple follow-ups with bank staff to get my account information.  The upside though, was that I could keep on top of my student loan account, and position myself to limit confusion about my loan transactions.

4. I Tracked My Transactions & Loan Documents

Student loan lenders process a high volume of transactions, on numerous loan accounts, which means there is a good chance of at least one error on any given loan account.

This is why I created my own tracking worksheet to make note of each payment I made, including when the payment was submitted and processed, how much of the payment went towards principal and interest; and whether the principal balance decreased by the amount I had projected.

Requesting copies of past statements and completing a close review, also helped me identify errors on my account, like when I was charged late fees during an approved period of deferment.

Student Loan Answers Book

5. I Set Up My Own Pay-Off Plan

Like most student loan borrowers, there were two important questions that came to my mind when thinking about how to tackle my student loan:

  1. When will I be done paying off my student loan?; and
  2. How can I pay off my student loan faster?

My amortization schedule listed my required minimum payments over a 10-year period, with my last payment ending in the year 2017. In 2012, I opted out of that default repayment plan, and create one that would place me on track to pay off my Caribbean student loan, as soon as I could, by adding an extra $2 per month to start.

I then went on to create my own pay-off plan to increase the size of my extra payments, and to make extra payments as often as I could.

[clickToTweet tweet=”She shaved $6,000 from her #Caribbean #studentloan after making $4,000 of interest-only payments” quote=”How Melisa Shaved $6,000 Off Her Student Loan After Paying $4,000 in Interest-Only Payments” theme=”style2″]

6. I Disputed Errors on My Loan Account

When mysterious fees showed up on my student loan statement, I identified my Lenders chain of command, filed disputes with my own supporting documentation, escalated the issue when the fees weren’t reversed, followed up and requested and received credit for these unexplained charges.

7. I Refinanced Some Of My Debt To Save Interest

As I got closer to making my last student loan payment, I refinanced about $1,000 or so on a 0% credit card that reduced the amount of the cost of paying back my Caribbean student loan, a bit more.

If you have a Caribbean student loan you can slash the high-interest costs of your own loans, even after a four-figure back, using these 7 steps that I detail in my book Student Loan Answers.

~Melisa Boutin

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Out-of-State Tuition Waivers for Caribbean International Students From The Florida-Caribbean Institute

Florida Caribbean Institute Out-of-State Tuition Waiver for Caribbean International StudentsThe Florida Caribbean Institute (FCI)  offers renewable Out-of-State Tuition Waivers for Caribbean International Students who have been admitted or meet the requirements for admission to any university or community college of the public education system of the State of Florida. Out-of-State tuition waivers can represent a 60% discount on tuition international students pay.

A limited number of these waivers are available, so run, don’t walk, if you are eligible to apply.

Scholarship Eligibility

To be eligible, applicants must:

  • Be an international student with a F1, or J1 visa.
  • Be fully admitted to a state college or university.
  • Have at least a 3.0 or higher GPA.
  • Be a citizen of the Caribbean from:
    – Antigua and Barbuda, Bahamas, Barbados      – Belize, Dominica, Dominican Republic          – Grenada
    – Guyana, Haiti, Jamaica, St. Kitts and Nevis     – St. Lucia, St. Vincent and the Grenadines               – Trinidad and Tobago 
  • Be committed to returning to your Caribbean country after the completion of your studies, for a length of time equal to their exemption period, as required.

[clickToTweet tweet=”Tuition Waiver For Caribbean International Students at Florida community colleges & universities!” quote=”Check out this great funding opportunity for Caribbean International Students!” theme=”style2″]

Application Deadline

All applications for this out-of-state tuition waiver opportunity are due June 1st.

The application can be downloaded, HERE and submitted by mail to:

Kimberly Green Latin American and Caribbean Center
Florida International University
11200 SW 8th Street
Modesto A. Maidique Campus
DM 353
Miami, FL 33199
Phone: (305) 348-2894
Fax: (305) 348-3593

Related: More Scholarships for U.S. & Caribbean Students

Where To Apply

For more information on the out-of-state tuition waiver and additional details on how to apply, visit The Florida International University Kimberly Green Latin American and Caribbean Center, funding opportunities, webpage, HERE.

Good luck and share this post to spread the word!

~ Melisa Boutin

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Featured – Personal Finance Contributor to Potent Magazine’s Come Back Issue!

Potent Magazine Article on Caribbean Student Loans by Melisa Boutin

I am so excited to be a personal finance contributor to Potent Magazine’s Come Back Issue!

Potent Magazine is a digital and print magazine that is the authoritative voice on Caribbean culture and its global influence. The Come Back Issue is the first issue available in print and I am so honored to be a contributor!

You can read the digital version of my article ” Caribbean Student Loans Shouldn’t Be This Complicated” where I share about the challenges Caribbean borrowers face when dealing with Caribbean student loan lenders and the systematic changes that are long overdue, here.

You can also order a print copy of the magazine on Potent’s website, too.

Thank you to the Editor in Chief, Genice Phillips,  for creating such a needed publication that highlights the “beauty and power of the Caribbean people”.

5 Thing Borrowers Should Know About Caribbean Student Loans

5 Things Borrowers Should Know About Caribbean Student Loans

 This post if part of the Financial Information Month 2016: Student Loan Series. During the Month of October, I will be sharing information about Caribbean Student Loans, stories from borrowers and highlighting the missed opportunities to address the current issues with the Student Loan System in the Eastern Caribbean.

The student loan stories shared as part of this Financial Information Month Student: Loan Series point to a pattern of Caribbean Student Loan lenders, who fail to adequately communicate with borrowers, leading to lots of confusion. I am committed to providing helping borrowers minimize the real stress involved with having a Caribbean student loan.

Here are 5 Things Borrowers Should Know About Caribbean Student Loans

1. Understand the Stages of The Student Loan Cycle

Your Money Worth Student Loan Series Student Loan Cycle: In-School Period, Grace Period, Deferment Period, Repayment Period

The typical student loan cycle consists of the In-school Period after the initiation of the loan and the first disbursement of loan funds. Once the borrower graduates from college, then the student loan enters the Post-Graduation Grace Period which is typically 6 months.

The Deferment Period is an optional stage where a borrower who has not found full-time employment, for example, request relief from the requirement monthly installment payments required and delay the student loan from entering the Repayment Period.

Deferment can be requested after the repayment period starts, if a borrower experiences a job loss.

It is important to note that interest accrues starting with the initiation of the loan and the first disbursement of funds and does not stop until the loan is paid off. For Caribbean student loans, borrowers’ and their co-signers are required to pay interest that accrues during the in-school period. Making interest payments throughout the in-school, post graduate-grace and deferment periods will reduce the costs of the student loan by avoiding accumulated interest to be added to the principal balance.

Interest only stops accruing on the student loan when it completely paid off at end of the repayment period.

To learn more about the different stages of the student loan cycle down loan the Student Loan Answers Book Preview HERE.

2. Proactive Communication With You Caribbean Student Loan Lender Is A Must

Let’s face it. Caribbean Student Loan Lenders have a big problem with communication. In my personal experience, it seems as if making it difficult for borrowers to get account statements and information updates was their goal.

Still, no matter how difficult it might be, if you don’t want your loan to get messed up like mines did or experience the confusion and frustration this borrower did, and possibly end up in a years-long dispute with your lender, schedule time to request account statements and other account updates to be sent to you in writing from your Caribbean Student Loan Lender.

If you are a current student, request account statement at the end of everything semester to confirm that any in-school interest payments are being applied correctly to your student loan account and that all the disbursement transactions match the amounts that were actually issued and received by you.

During the repayment period, request statements at least monthly. Even if you aren’t provided a statement from the bank regularly, make it your business to request one from you loan officer and if you are dismissed or experience a delay in receiving your account information escalate your request up the chain of command.

Financial Information Month Student Loan Series 2016 More Related Articles

3. Tracking And Documenting Transactions on Your Student Loan Account Is A Major Key

On top of proactively communicating with your Caribbean Student Loan lender, it is just as important to track the transactions on your account carefully. Review your account statements to verify every transaction on your account periodically and flag any discrepancies that you find and request that they be addressed by your lender.

It’s a given that dealing with many Caribbean Banks is like pulling teeth, but it will be just a bit easier if your are on top of your account and set up a systems to secure all your receipts, statements and copies of your disbursement checks in case you ever have to provide documentation to support your requests for resolution of any erroneous transactions on your student loan account.

4. Know That You Can Pay Off Caribbean Student Loans Ahead of Schedule

Although Caribbean Student Loans can be a large burden on graduates, you can pay them off ahead of time. To do that, not only will you have to delay inflating your lifestyle, forego vacations and weekend brunches, but you will also need to setup your own repayment plan and closely scrutinize how your payments are being applied to your student loan account.

5. There Are Alternatives to Caribbean Student Loans

Most Caribbean college student access Caribbean student loans to fund their high education. In fact, a 2005 Assessment Report on the Caribbean Student Loan Scheme, found that 80% of borrower interview could not pursue a college education with using a Caribbean student Loan.

But there are alternatives.

  • Private U.S. Student Loans
    • Lenders like, offer student loans to international students who has an eligible co-signer who if a Permanent Resident of Citizen of the United States and is able to meet the loan credit requirements.
  • Organization of American States (OAS) offers Interest-Free Student Loan through their Leo S. Rowe Pan American Fund .
    • The OAS  accepts applications on a rolling basis. The loan information can be found HERE.
  • Scholarships specifically for Caribbean students do exist and you should apply for them.
    • Scholarships specifically for Caribbean students shoul  be considered as a source of funding for college. I share opportunities right on my Start Here page.

If you have a Green Card or you are a U.S. Citizen, like I was when I was going off to college, avoid taking out a Caribbean student loan, all together. You are better off choosing a cheaper school and applying for scholarships you are eligible for than taking out a Caribbean student loan.You should learn from my experience.

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