Long-Term Financing: An Option to Cover College Costs
If you are interested in long-term financing for your college costs, we can direct you to a number of loan programs, including:
Federal Direct Student Loans
The Federal Direct Stafford Loan is available to U.S. citizens and permanent residents to assist with paying college costs. The type of Direct Loan a student is awarded (subsidized or unsubsidized) is based on results of the FAFSA and will be listed on your Financial Aid Award Notification each year.
Requirements for Borrowing the Federal Direct Loan
All new borrowers (including transfer students) of a Federal Direct Stafford/Ford Loan are required to complete entrance loan counseling and the Federal Direct Loan Master Promissory Note before their Federal Direct Loans can be disbursed.
If you have questions about your promissory notes or loan counseling, please contact the Office of Student Financial Services. For more information about Federal Direct Loans, visit "Types of Aid" on the Federal Student Aid site. Information regarding your personal Direct Loans can be accessed on the Direct Loan Servicing Center site.
Federal Direct PLUS Loans
Parents of dependent students may apply for a Federal Direct PLUS Loan (Parent Loan) to help pay college costs. A parent who has no adverse credit history may borrow up to the cost of education each year, less any financial aid received by the student. The interest rate for this loan is fixed at 6.31%. Repayment begins within 60 days after the final disbursement of the loan, which typically occurs in March for students enrolled the full academic year. Parents must apply each year to borrow a PLUS loan.
How to Apply
The Parent PLUS Loan application can be found online through the Department of Education. Please apply at studentaid.gov.
When you apply for a Direct PLUS Loan as a parent, you can authorize Knox College to use your loan funds to satisfy your student's other educational related charges after tuition and fees, and room and board (for on-campus students) have been paid. You are not required to provide this authorization.
As a parent borrower, you can also use the Direct PLUS Loan Application to:
designate whether the school pays any credit balance to the student or to you.
request a deferment while the student is in school, and for an additional deferment for six months after the student ceases to be enrolled at least half time, and
request a change to the loan amount specified in a previously submitted application.
If Your PLUS is Denied
Dependent students whose parents have been denied eligibility for a Federal Direct PLUS loan have expanded loan limits under the unsubsidized Direct Loan program. Depending on their college costs and financial aid, these students may borrow the maximum Direct Loan limits, plus: $4,000 for the first two years of undergraduate study and $5,000 for subsequent years of undergraduate study. For more information about Federal Direct Loans, visit "Types of Aid" on the Federal Student Aid site. The Office of Student Financial Services will notify you and your student of the additional loan eligibility if the Federal PLUS Loan is denied.
U.S. Citizens, Permanent Residents, and International Students
Students and their families may be interested in private loan options as a supplement to federal loans. Private loans may be available to students who have no adverse credit history and have a credit-worthy co-signer. We encourage parents and students who seek private long-term financing to do some "comparison shopping" in order find the best terms for their particular financial circumstances. It is advised that private loans be used after the student's Federal Direct Loan eligibility has been exhausted.
Below is an alphabetical listing of private loan programs Knox students have borrowed through in the past.
* International students: Most private loan lenders will require that you have a U.S. co-signer.
Other Financing Options
Payment Plans
A Knox education is an investment in your future, and our goal is to help you feel confident that you can afford that investment. The first step in this process is deciding what tuition payment option is best for you and your family.
The Office of Student Financial Services offers convenient payment arrangements to manage college costs. They have partnered with CASHNet to provide electronic payment options and monthly payment plans. A payment plan allows you to make monthly payments instead of one payment per term. The payment plan is not a loan and there are no interest charges. The only cost is a small enrollment fee each term. Payment plans for each term can be set up for either four months or three months.
Students will receive an email at their Knox email address in July that includes their bill for fall term and instructions on how to access the CASHNet portal. They will also receive instructions on how to give parents or guardians access to the portal. Only students will receive this initial email.
If you have any questions about your payment options, please contact Office of Student Financial Services.
Payment Plan and Loan Combination
If your family budget requires a smaller monthly payment, you might consider a combination of long-term loan (through the Federal PLUS or private loans above) and a monthly payment plan through CASHNet. This combination would be designed to meet your budget and cover the entire cost.
Other Possibilities
Other resources you might consider include a home equity line of credit, which may have tax benefits, or other collateralized loans. Discussing these options with your financial advisor and/or banking institution may be beneficial.
