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					education financing options
Some families look for financing beyond need-based financial aid. Listed below are options that 30 percent of our families use
to pay for college. Families sometimes use a combination of the TMS Payment Plan and Federal Direct Parent PLUS loan.


                         Tuition Management Systems (TMS) Payment Plan
                                Interest Free 10 month payment plan
              advantages                                   features                                how to apply

 • Low cost                                  • 10 equal monthly payments                • Plan runs from June 1, 2011,
 • Interest Free                             • $50 application fee ($75 after July 1)     through March 1, 2012

 • Short Term                                • Plan amounts appear on fall/spring       • Call (888) 713-7238 or visit
                                               tuition bills                              https://www.afford.com/fandm
 • No Pre-approval Required


                                      Federal Direct Parent PLUS Loan

              advantages                                   features                                how to apply

 • Fixed Interest rate: 7.9%                 • Borrow up to cost of attendance,         NEW for 2011-2012
 • e-Sign MPN one time                         less other financial aid/student loans   Student and custodial parent must
                                             • Borrow for full academic year            file FAFSA to be eligible to borrow
 • Interest may be tax-deductible;                                                      PLUS Loan.
   details found on IRS PUB 970:             • Loan disburses in two equal
   www.irs.gov/pub/irs-pdf/p970.pdf            payments: fall and spring                • Apply by July 1, 2011

 • Credit worthy (not based on debt-         • 2.5% fee deducted from loan at           • Simplified application process
   to-income ratio or FICO score)              disbursement                             • Go to www.studentloans.gov:
 • Discharged for death or permanent         • Deferment options                          1. Sign in using parent information
   disability of borrower or student         • 24/7 online account access                    (not student information).
 • 10-year standard repayment                                                             2. Click on Request PLUS Loan.
                                             • No penalty for early repayment             3. E-sign master promissory note.
 • Option to defer principal and             • Annual credit check required
   interest while student enrolled                                                      For more PLUS Loan information,
   half time                                                                            go to www.ed.gov.directloan.


Who is eligible for the Federal Direct Parent PLUS loan? The parent or legal guardian of a dependent undergraduate
student enrolled in college at least half time. Both parent and student must be U.S. citizens or eligible noncitizens, must not
be in default on a federal student loan and may not owe a refund on a federal educational grant. Parent must have no adverse
credit history.

When does repayment begin? Standard repayment begins 45 days after funds are fully disbursed. For PLUS Loans that are
first disbursed on or after July 1, 2008, the borrower has the option of beginning repayment six months after the dependent
student on whose behalf the parent borrowed ceases to be enrolled on at least a half-time basis.

Who is the lender? The federal government. Upon disclosure you will be notified which agency will service your loan.
                               Federal Direct Parent PLUS Loan (example)
John is entering college in the fall of 2011. He received $32,000 in total financial aid (Federal Work Study, grants and loans).
John’s cost of attendance, or COA (tuition, fees, room & board, and estimated miscellaneous expenses), is $57,000 for the
2011-2012 academic year. The maximum Parent PLUS eligibility would be determined as follows:

     $57,000 Cost of Attendance
     $32,000 minus total financial aid
     $25,000 PLUS loan eligibility

If John’s parents borrow the $25,000 maximum amount of Federal Direct Parent PLUS eligibility, the net disbursement of
$11,700 per semester (after the 2.5% loan fees) would be credited to John’s account. The monthly payment for $25,000 would
be $290 over a 10-year (120-month) standard repayment term. If John’s parent borrows the same amount for years 2, 3 and 4,
the monthly payment would increase by $290 per year for each additional year of borrowing.

Federal Direct Parent PLUS loan repayments can be calculated by visiting www.finaid.org, selecting Calculators, and then
selecting Loan Calculator under the Loans section. Enter the loan balance that you wish to borrow using an interest rate of
7.9% and a loan term of 10 years, and click Calculate.


                          Example Repayment Amounts (per academic year)
                          Parent PLUS Loan Borrowed                Monthly Repayment (120 Months)

                                    $2,500                                         $50
                                    $5,000                                         $61
                                    $10,000                                        $121
                                    $15,000                                        $182
                                    $25,000                                        $302
                                    $30,000                                        $363
                                    $45,000                                        $544
                                    $50,000                                        $604


                                              Additional Information
Additional $2,000 of Unsubsidized Stafford: Students are eligible to borrow an additional $2,000 of Unsubsidized
Federal Direct Loan beyond the $3,500 base first-year level. The principal would be deferred until six months after
graduation, with the interest payable while they are in school or capitalized at repayment. Interest on a $2,000 unsubsidized
loan is approximately $12 per month.

Additional $4,000 of Unsubsidized Stafford: If a student’s parent is denied a Federal Direct Parent PLUS, the student
would be eligible to borrow an additional $4,000 of Unsubsidized Federal Direct Loan beyond the $5,500 first-year level.
The principal would be deferred until six months after graduation, with the interest payable while the student is in school or
capitalized at repayment. Interest on a $4,000 unsubsidized loan is approximately $23 per month.

Federal tax benefits: Some families may qualify for certain tax benefits provided by the federal government for specific
expenses related to attending college. For more information, go to www.collegeboard.com/parents/pay/scholarships-aid.

Private student loans: Private student loans should always be the last consideration for financing an education. Families
should exhaust federal loan options before considering a private loan. Private loans often have variable interest rates with no
cap or ceiling, require a credit check, and do not provide the benefits of federal loans. In addition, the credit criterion for
private loans has become more stringent, and all students will require a creditworthy cosigner. Contact the Office of Financial
Aid for a list of lenders previously used by our students. Tip: Before signing on the dotted line, make sure you read and un-
derstand the terms and conditions of the loan. Note: Some loans require you to make interest payments while your student
is enrolled in college.


                                Office of Financial Aid • www.fandm.edu/financialaid

				
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