College tuition invoices are in the mail and will be due in the next several weeks, leaving some New York students and families scrambling to fill the tuition gap between their available financial aid the amount due on the bill.
The New York State Higher Education Services Corporation (HESC), the State’s student financial aid agency, announced recently the availability of $96 million in funding for fixed-rate education loans through the New York Higher Education Loan Program (NYHELPs) to students and parents looking to finance their college costs for the upcoming academic year.
NYHELPs loans are available only to New York State residents and are for students attending a participating college in New York State. Students, parents, or a non-parent sponsor can receive a NYHELPs loan to help pay for a student’s total cost of attendance, including tuition, room and board, books and transportation costs.
Scholarship sources say that students and families who neglect loans offered by their home states could be missing out on some of the best college financing options. Specially priced state financing programs like NYHELPs generally offer students a reliable source to more affordable private education loans.
"As we enter the peak student lending season, students and families may begin to see interest rate drops in variable-rate private loan programs," said HESC acting president Elsa Magee. "We strongly encourage students and families to do their homework when shopping for a private education loan so that they will select wisely and make the best choice to fit their needs."
Unlike the many available variable-rate loans in the private student loan market, NYHELPs interest rates will not change over the life of the loan.
For the 2010-2011 academic year, NYHELPs will offer fixed interest rates of 7.55 percent for borrowers choosing to make immediate principal and interest repayments, 8.25 percent for borrowers opting to make interest only payments, and 8.75 percent for borrowers looking to defer all payments until graduating.
Borrowers who elect to make automated debit payments will receive an additional 0.25 percent interest rate reduction upon entering into repayment. The estimated Annual Percentage Rate (APR) ranges from 8.78 percent to 11.19 percent, depending on the loan repayment selected and the borrower’s default fee.
Along with its requirement that students first apply for and receive all other free and low-cost aid for which they are eligible, NYHELPs requires that borrowers complete a financial literacy education course in order to receive loans that are capped at $20,000 for students pursuing a two-year program of study, $50,000 for students pursuing a four-year program of study and $70,000 for students pursuing their graduate study.
To learn more or apply for a NYHELPs loan, visit www.hesc.com/NYHELPs.
– Courtesy of HESC