Released: September 19, 2008

Student cashes in savings after private loan falls through

Source: Emanuella Grinberg, CNN

Eric Hahn thought his financial situation was set after he was approved for a private student loan with an 8 percent interest rate to supplement his federal education loans.

Just a few weeks later, Hahn, 21, was forced to cash in his savings and investments so he could make his rent and tuition after finding out that the lender, MyRichUncle.com, had suspended its private student loan program.

“Due to continued disruptions in the capital markets, combined with the continued demand we have experienced this year, we are reaching funding capacity limits,” a message on his cell phone said, mimicking a statement on the company’s Web site.

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