Student Loan Option

Mr. and Mrs. D’souza are highly encouraging parents. They wanted their son and daughter to pursue their education in the field of engineering. Being bright students both of them have secure excellent scores and have admissions from the best of colleges. Their performance has earned them scholarship from their chosen college of study, but the scholarship amount is not sufficient to meet the cost of education. Hence, they were in search for the most optimal Student Loan Option to fill the gap in the college funding. They were not interested in using up their personal funds in view of future contingencies. This is what they had to decide upon.

Student Loan Option for Families:

. Student Only Option: The student alone will borrow the amount from Federal Stafford Loan and the remaining if any to be funded out of Private Student Loan. . Student and Parent Share Option: The Student borrows the annual limit from the Federal Stafford Loan and the parent from the Federal Parent PLUS Loan. Remaining to be sourced from a Private Student Loan. . Parent Only Option: Parent borrows the necessary amount from Federal Parent PLUS loan.

Federal Stafford and Parent PLUS are available to all families irrespective of their income levels. Wherein the FAFSA application has not been completed by the student then he/she is not eligible for any of the federal loan schemes. Private Student Loan becomes the only source of finance.

In addition to the above details the following were the advantages noticed by Mr. D’souza and family.

• No credit check required for Federal Stafford Loans
• FAFSA application has not made disclosure of parent’s financial information mandatory
• Depending on the financial condition Federal Stafford Loans can be doubled for the benefit of the student.

Mr. and Mrs. D’souza have opted to go for Student and Parent Share Option in order to divide the financial burden and get the benefit of both the loans avoiding the Private Student Loan option.