Case 4 Victor and Maria Advise Their Niece

(a) What advice might Maria give Teresa about managing her student loan debt?

(b) If next year Teresa were to consolidate her loans into one loan at 8 percent interest, what advice might Maria give regarding Teresa’s overall debt limit using both the debt payments-to-disposable income method and the continuous-debt method? (Hint:
Use Table 6.3 on page 181 or visit the Garman/Forgue companion website to calculate monthly payments for various time periods.)