Education Loans Interest Rate and Repayment
The Interest rate is a combination of the Prime rate plus or minus a margin. The rate will fluctuate as the Prime rate changes every three months.
The Prime rate is a "reference or base rate" that banks use to set the price or interest rate on many of their commercial loans and some of their consumer loan products. The prime rate tracks fairly closely with other short-term interest rates, such as the overnight federal funds rate.
Loan Fee
There may be a fee added to the principal balance. Adding a credit worthy co-signer can reduce or eliminate this fee.
Loan Repayment
You have three options including deferment or repayment of interest only or interest and principle.
Full Deferral: No principal or interest payments due while enrolled in school (up to four consecutive years). Payment of principal and interest will begin 6 months after graduation or if no longer enrolled at least half time. Interest will continue to accrue during the deferment period and will be capitalized (added to the loan balance) at the time of repayment.
Interest Only: Pay only accrued interest while enrolled in school (up to four consecutive years). Payment of principal and interest will begin 6 months after graduation or withdrawal from school.
Immediate Repayment: Payment of principal and interest will begin after the loan is fully disbursed.
