<p>We are in the midst of figuring out financing for our 2 d's, has anyone gone this route, and what besides filling in the paper work is needed. Obviously we'd like to do without, but with 2 in and we still need to come up with $$. If needed for subsequent years, do you just reapply and they add that to the first loan? thanks</p>
<p>I am familiar with the process. Have you daughters received their financial aid award letters yet?
Most award letters SUGGEST a parents plus loan usually for the amount of your EFC or the COA minus any scholarship, grants, stafford and perkin loans. You can take the whole amount or less.</p>
<p>Most people start the application in June, July.
Since these are loans from the government, you usually have to go through a state ed portal to apply. In NYS, you have to go through NYSHEC to apply. It is a very simple process and the credit worthiness is very loose. They look at very loose criteria. You are approved/declined immediately throught the online process. My experience is with NYS so I am giving you my experience with the process. I would imagine it is similar in the different states.</p>
<p>As you go through the application process, once you are approved, it will allow you to put your D’s school down and based on the school, it will list the schools prefered lender such as Sallie Mae, etc. You can choose the school’s lenders or who ever you want to underwrite the loan. You will then sign a promissory note( which you will never have to do again ever, becasue it is good forever). You school will receive all the information and certify your loan for use to pay for your childs tuition.
You can apply for as long as your children are in school and what I like best is that you can defer repayment for as long as your child is in school. You can opt to just pay the interest so that that is not compounding. Also if at some point you have an economic hardship the is loan forebeartance or God forbid, an unforseen death occurs with a parent or student the loan is cancelled.
The only issue I had, was that I only wanted a small amount for the parent plus loan, even though the school certified a larger amount so Sallie mae sent the larger amount. To correct this I called the FA office and they had the Bursar send the portion back to the lender that I did not want to keep.
It was nice that even thought I didn’t want the whole thing, it was there in case something came up and I needed more money for tuition.</p>
<p>I hope this helps.</p>
<p>[Student</a> Aid on the Web](<a href=“http://studentaid.ed.gov/PORTALSWebApp/students/english/parentloans.jsp#01]Student”>http://studentaid.ed.gov/PORTALSWebApp/students/english/parentloans.jsp#01)</p>
<p><a href=“http://www.finaid.org/loans/parentloan.phtml[/url]”>Your Guide for College Financial Aid - Finaid;
<p>One last thing I wanted to add, if you going to go for a Parent plus loan, I would shop around for a lender that is going to give you better deal.
If I knew then what I know now…When i was doing this last spring…
Sallie Mae I believe has a 3% orgination fee, which goes straight to their pocket. Another poster pointed out Discover Student loans had 0% origination fee. By that time I had already committed to Sallie Mae. Also you do not have to stay with one lender year in and year out. So wisdom says…shop around for the best deal. That includes your daughters stafford loans as well. You will also be able to consolidate your loans down the road.</p>
<p>You don’t have to use a HESC lender if you are going to school in NY.
At least I didn’t have to for a Stafford loan. I found more favorable terms with a different lender. I had to send a special form to the FA office of the school to tell them the lender and guarantor, but I didn’t have to pay any origination fee or guarantor fee for the stafford loan (I think these fees are not waived for plus loans with the lendor I am using)</p>
<p>Edit: I am the one that posted about <a href=“Student Loans for College & Graduate School | Discover”>Discover Student Loans; they don’t withhold fees for stafford loans (which is not what the OP was talking about, but you can also get a Plus loan from this lender)</p>
<p>All the PLUS loan info I’ve looked at has a 3% origination fee. Discover says it’s required by the feds:
- There are zero guarantor fees and zero prepayment fees, but the government requires that we charge a 3% origination fee on Federal PLUS loans.</p>
<p>Definitely shop around - </p>
<p>A PLUS loan is a 10 year loan. You can consolidate it and change the terms to 20 years. You can consolidate it once but at any time. In other words - if you take out a loan for each year your child is in college you can wait and consolidate them all at once if you want. Or you can consolidate when interest rates are favorable.</p>
<p>The amount you borrow is split in two halves. If you borrow $6000 then $3000 will go to the school for the first semester and $3000 for the second semester. Repayment begins 60 days after the final disbursement.<br>
If you are using it for cash flow purposes you won’t get a bill until about March. There are no penalties for prepayment, so you can pay it off at any time.</p>
<p>The interest rate fluctuates from year to year but never rises above 9%. Right now it’s 8.5%, but it’s been much lower in the past. Some lenders will give you a reduction if you have automatic withdrawal.</p>
<p>You can use any lender you want and FA offices are not supposed to tell you from whom to borrow. Check out Discover loans and also your State higher ed agency - some will waive the guarantee fee.</p>
<p>Also, if for any reason you get turned down, my understanding is your child will then be eligible for extra unsubsidized stafford loans.</p>
<p>^
yep- this is true. it’s $4000 more but unsubsidized.</p>
<p>The first thing you need to do is go on your school’s financial aid website to see if they are a Direct Lender school or a FFELP school. If DL, you must apply for the PLUS directly through the school - no shopping around - it’s government-direct lending. If FFELP, you can shop around.</p>
<p>thanks all, questions -
do you have to wait till June/July to apply. What about needing one for each daughter, do you have to apply twice. Neither of their schools are a Direct Lender school. The paper work we rec’d so far said that we are to look for a lender. Is it better in these economic times to just use sallie mae, with banks closing all around. The schools my one daughter is looking for is in VT. and she did rec. her FA award letter. The other D is a freshman in college this year and she in MD. So does that mean I will have to have two plus loans, one per each and 2 Prom. notes, etc. Thanks, never ending is it.</p>
<p>I believe the answer is yes. You can find out information on the Sallie Mae website.</p>