Resources

Things To Consider

Funding gap?

If you have a gap in funding – the actual direct costs that show up on the tuition bill less any grants, scholarships and possibly the federal student loans, is called a gap. There are different options available to pay that gap. Consider 529 monies, savings, family, HELOC, or maybe a college payment plan. It is not recommended that you pay via credit card (unless you have the means to pay it off – as colleges usually pass on the fee) or to withdraw retirement funds. Always wait for the actual bill before applying for either loan type. Do not borrow more than needed.

Federal vs. private

The options for education loans fall into two categories; federal loans or private loans. Federal parent loans are commonly referred to as Parent Plus loans. The parent that completed the FAFSA with their FSA ID is the parent that can log into studentaid.gov and apply for the PPL. This usually takes about 15 minutes to complete and approved within 48 hours. Remember this is a parent loan, that is linked to the parent until completely paid. Read additional information about PPL here or reach out with any questions.

Apply to multiple lenders

Private lenders vary widely and many offer incentives to entice you. Though these incentives can be a benefit, it is not wise to choose a lender for those benefits alone. The interest rate and payback options need to fit your budget and cash flow. I recommend applying to at least two, maybe three lenders to be sure you are getting a loan that fits your needs. Again, once you receive the bill, start the application process, as it can take 7-10 days. Rates are not locked in until the master promissory note is signed.