| Parents of college students would like to see their child | | | | housing, college supplies, computer, and other |
| succeed in school. A college degree brings the benefits | | | | education-related expenses. You want to borrow |
| of higher pay, better career, and a more stable life. But | | | | enough money to meet your budget plan. |
| the cost for a college education can be enormous. | | | | Since the student will not have a credit history to |
| The annual cost to attend an in-state public school | | | | qualify for the loan, the parent will need to act as |
| averages $16,000 or more; $26,000 for out-of-state | | | | co-signer. The student will have the option to defer |
| schools. And attending a private school is even more; | | | | payments until after graduation. Do not select this |
| averaging around $33,000 or more per year. Who has | | | | option. Select the option for immediate principal and |
| that kind of money? | | | | interest repayment. |
| Qualifying students can apply for scholarships, college | | | | 4. Setup a Money Account: The money borrowed |
| aid assistance, and federal student loans. But the total | | | | from the private student loan will be sent directly to the |
| amount awarded may cover only half of the total | | | | student. The student will deposit the funds into their |
| academic costs. Students often turn to their parents | | | | bank account for use to pay school expenses. |
| for assistance. | | | | The best way to manage, expense and protect |
| Parents can help finance college using the federal | | | | student money is using pre-paid cards instead of ATM |
| PLUS loan, which can pay up to the total academic | | | | and credit cards. With pre-paid cards, you upload |
| costs minus the financial aid received by the student. | | | | money to the card as budgeted in your plan. Pre-paid |
| But the PLUS loan has restrictions. And most parents | | | | cards can be used just like credit cards to pay for |
| do not want to take on the full burden of college | | | | living and personal expenses at college and local |
| financing. There is a better way. We call it: | | | | merchants. The spending amount on pre-paid cards is |
| The Bank Equity College Financing Program | | | | limited by the amount loaded to the card. You can |
| It's quite effective. You use your bank equity to pay | | | | monitor pre-paid cards online to help the student live |
| the financing costs of a private student loan taken out | | | | within the budget. |
| in the student's name. This allows parents to help pay | | | | 5. Parent Pays the Monthly Loan Payments: the |
| for school without taking on the full responsibility. Let's | | | | monthly payments from the private student loan will |
| review how this concept works. | | | | begin 30-60 days after the first disbursement. Parents |
| | | | will use their equity line account to make those |
| 1. Open a Home Equity Line of Credit: get a home | | | | payments on behalf of the student. You will continue to |
| equity line of credit secured by the equity value of | | | | make monthly payments while the student is in school. |
| your home. Open the maximum credit line at the | | | | 6. Student Takes Over the Monthly Payments Upon |
| lowest LTV percentage. You will use your equity line | | | | Graduation: when the student graduates from college |
| like a bank to finance college and other related | | | | and lands a good job, the student takes over the |
| personal needs (explained below): | | | | monthly payments from the parent. Parents can even |
| (note: if your home value does not qualify you for a | | | | get a co-signer release if certain parameters are met. |
| credit line at 80%LTV or less, then apply for a credit | | | | The student continues to make payments until the loan |
| line at 90%LTV. Your credit line must be large enough | | | | is paid off. |
| to pay down debts and finance college as explained | | | | So What Are the Benefits |
| below) | | | | - First: the parent is able to assist the student pay for |
| 2. Develop a College Budget: get with your student to | | | | their college of choice by co-signing the private student |
| develop a college budgeting plan for the academic | | | | loan. |
| year. This will help the student estimate the costs that | | | | - Second: the parent is helping the student through |
| will be expensed for the month. You need to budget | | | | college by making the monthly loan payments while the |
| for financial aid, tuition, housing, books, transportation, | | | | student is in school. |
| entertainment, and other personal needs. | | | | - Third: the student assumes some responsibility for |
| Download FREE our college budgeting worksheet to | | | | their college expenses by taking over the payments |
| assist you in this task | | | | upon graduation. |
| 3. Apply for Student Financial Aid:your budget plan will | | | | - Fourth: the parent can use their home equity line to |
| show how much additional aid you will need to meet | | | | reduce their overall financing costs. |
| estimated costs. You student will then apply for a | | | | We have a bank equity program where you can |
| private student loan using the parent as the co-signer. | | | | maximize your equity savings for paying college, |
| Students can borrow up to $30,000 per year ($40,000 | | | | reducing debts, and paying down your mortgage. And |
| for certain schools where the cost of attendance has | | | | you don't need to change your cash position. |
| been determined to exceed $30,000) to pay for tuition, | | | | |