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Dinniman Announces New Low-Cost Loan Program for Pa. College Students
WEST CHESTER (January 14, 2019) – State Senator Andy Dinniman encouraged prospective college students who may be applying for financial aid this year to consider the new PA Forward Student Loan Program.
The PA Forward State Grant Program provides low-cost, alternative student loans for undergraduate and graduate students, as well as loans for parent borrowers. The program is designed to complement other forms of student aid, such as the PA State Grant Program and low-cost federal loans. It is ideal for Pennsylvania students who need help paying for college after exhausting their eligibility for gift aid and low-cost federal student loans.
Additionally, borrowers who are in repayment and want to combine their debt after graduation to outstanding student debts and achieve a lower monthly payment can benefit from a PA Forward Refinance Loan.
“This new program will help bridge the gap in funding for many students and young people who are facing the challenges of the rising costs of higher education,” said state Senator Andy Dinniman, minority chair of the Senate Education Committee. “Fortunately, we now have these low-interest loans available to those who have already exhausted grants, gifts, scholarships, and other funding sources.”
PHEAA is the lender and servicer of the loans, with tax-exempt financing provided by the Pennsylvania Department of Community and Economic Development.
PA Forward participants can borrow up to the total cost of attendance with competitively low-interest rates. There are immediate credit approvals and flexible repayment options, with no application or origination fees. Borrowers can get discounted interest rates by enrolling in an automatic direct debit repayment program and simply by graduating.
Borrowers can receive a .25 percent interest rate reduction for enrolling in an automatic direct debit program and an additional .50 percent interest rate reduction for achieving successful graduation. Borrowers also benefit from a 6-month grace period after graduation before the first payment is due. This allows borrowers time to get their finances in order, including time to find a job, before repayment begins. Borrowers who take full advantage of the program’s benefits could save thousands of dollars over the life of the loan.
PHEAA encourages students and their families to exhaust all eligibility for grants and scholarships before considering a student loan. When borrowing is necessary, students should first apply for low-cost federal student loans before turning to an alternative student loan, which often have higher interest rates.
To help students make informed choices about their higher education funding plan that can prevent unnecessary or excessive borrowing, PHEAA created MySmartBorrowing.org. This free resource helps users understand how different career, school, and financial decisions made during the college planning process can influence their total cost of education and their ability to repay any student loans after graduation.