GRADPLUS LOANS FOR GRADUATES

What is a GRADPLUS Loan?

Student Aid Centers of America is committed to finding a variety of ways to finance your graduate education. One such option is a GRADPLUS. A GRADPLUS loan is a federally-sponsored student loan that can cover up to 100% of your cost of attending school (less any financial aid). GRADPLUS loans are a cost-effective alternative solution to tapping your home equity line or securing a private loan with potentially high interest rates. Additionally, you can obtain a GRADPLUS loan without collateral and with a minimal credit rating.

GRADPLUS Loan Benefits:

• No collateral required for this student loan
• Less than perfect credit ratings not an issue
• Cover your cost of attending school (less any financial aid)
• Money saving rate reduction programs available through the Student Aid Centers of America
• No need to risk your home or personal assets
• Early payment with no fees lets you pay off your student loan without a penalty  
• Payment suspensions of your student loan available
• A cap on this student loan's interest rates as mandated by the federal government
• Mid-year GRADPLUS loans available
• Tax deductions may be available for this student loan

Have Questions?   Call One of Our Educated Student Loan Counselors at 1-800-xxx-xxxx now!

Eligibility Requirements:

Graduates

Students who meet the following eligibility requirements may apply for a GRADPLUS loan:

• A U.S. citizen or permanent resident
• Credit secure
• Not in default on any student loans
• Less than 24 years of age
• A full-time or half-time student
• Unmarried and with no dependents
• Not a word of the court
• Not a veteran

Mid-Year Loans

If you find you need extra funds for school, you may still apply for a GRADPLUS loan mid-school year. The deadlines vary from school to school. In most cases, the deadline is just prior to the end of the school year. You should contact your school's financial aid department to learn the exact deadline.

Have Questions?   Call One of Our Educated Student Loan Counselors at 1-800-xxx-xxxx now!

GRADPLUS Loan Interest Rates and Fees

GRADPLUS loan rates disbursed after July 1, 2006 are fixed at 8.5%.   GRADPLUS loan rates disbursed before July 1, 2006 are variable (capped at 9%) and adjusted annually. The current adjustable rate through June 30, 2007 is 7.94%. Rates for this student loan will never exceed 9%, by federal mandate.

Loan Fees

• Origination Fee

  Each time money is disbursed, a 3% origination fee of the principal is deducted.   For example, if the school certifies $15,000 for a school year, $450 is added to your total.   If two disbursements for this student loan program are made during the school year, the origination fee amount withdrawn is divided in half ($225 is taken out each of the two times a disbursement is made).   This fee is given to federal government to offset the cost of the GRADPLUS loan program.
  

• Guarantee Fee

  As a safeguard against fraud, a 1% guaranty fee is due as insurance against default on this student loan.
  

• Tax Deduction

  As of 2001, you could be eligible to deduct up to $2,500 in interest from a GRADPLUS loan.   Section 221 of the Internal Revenue Code allows some student loan borrowers to deduct a portion of their interest costs for a given year.   This deduction may be contingent on the loan's disbursement date and your income.   Please talk with your tax advisor for more details.

GRADPLUS Loan Amounts

A GRADPLUS loan is a supplemental form of student financial aid. You must complete a Free Application for Federal Student Aid (FAFSA). You will then receive an award letter from the school calculating your financial aid subtracted from the cost of attendance. The amount the school certifies for your GRADPLUS loan is equal to the total of your Expected Family Contribution (EFC), the unmet need and the GRADPLUS loan's 3% origination fee. Contact your school's financial aid department if you have any extenuating circumstances (medical expenses or recent unemployment) that may impact the cost of attendance or expected family contribution.

For example, if your school certifies $24,076.25 out of a requested $30,000 but you have not received your award letter yet. You may still apply for a GRADPLUS Loan even without your award letter. Just make sure you request up to the cost of attendance GRADPLUS the 3% origination fee so you are guaranteed to receive the full cost and won't have to apply for a mid-year loan.

Calculating a GRADPLUS Loan from Your Award Letter