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What if parents and students don’t have enough financial
aid to cover all of the expenses?
The purpose of financial aid is to assist students and their families in
funding their education. Although the Financial Aid Office will make every
attempt to meet your financial need, you may not have enough to cover all
of your educational expenses. In this case, a few alternatives exist that
may help in your financial dilemma.
Scholarships
Many scholarships exist that can
help pay a portion of your expenses. Most scholarships are based upon academic
merit, but there are many others available as well. Take some time to search
the internet and other sources for scholarship information. Please note that
you should NEVER pay for a scholarship search. There are hundreds of free
search tools to help you.
Parent PLUS Loans
The PLUS loan is a federally sponsored
and regulated national student loan program. Parents of dependent students
can take out loans to supplement their children's aid packages, so the loan
is actually the parent's loan and not the student's. The maximum annual limit
that your parent can request equals the cost of education minus other aid.
The interest rate, based upon 91-day T-Bill rates plus 3.1% will cap at 9%.
Checks or electronic fund transfers are co-payable to parent and school and
will first apply to the student's account balance. The remaining funds (if
any) are then sent directly to the parent. The Plus Loan does require a credit
check and some parents may not be eligible for the loan. If a parent is turned
down for a PLUS loan and receives a Letter of Denial, the student may be
eligible for additional Stafford Loan. Please notify the Financial Aid Office
if this occurs.
Repayment begins 30 days after the first disbursement of a multiple disbursement,
but there are ways to defer payments while the student is in school. Like
the Stafford and Perkins Loans, the PLUS loan also has a PLUS Master Promissory
Note that must be completed. In addition, the parent must also complete the
PLUS Loan Application. A parent will receive a response to their loan application
within 10 working days.
Alternative Education Loans
After the traditional loan options, like Perkins, Stafford and PLUS have
been exhausted, students can look into the Alternative Loan market. Unlike
the Federal Loan Programs, Alternative loans are not regulated by Federal
Financial Aid Regulations, so banks will set their own interest rates, terms
and conditions of the loan. Because interest rates on these loans are typically
much higher than those found in the federal programs, balances can compound
quickly. For this reason, students should use this type of loan sparingly.
Information about Alternative Loan comparisons, go to the Students/Parents
section of the WASFAA (Wisconsin Association of Student Financial Aid Administrators)
web site. Feel free to contact a Financial
Aid Adviser to review your options.
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