Monthly Payment Plans
Monthly Payment Plans, such as those offered by Academic Management Services (AMS) and Tuition Management Systems (TMS), allow you to pay for current academic year expenses out of your current monthly income and savings. Schools can set up these payment plans where they spread the cost of tuition over a particular time period and you are able to make smaller monthly installments instead of one large payment. You may choose to cover all or part of your educational costs with one of these plans. Monthly Payment Plans do not require you to take out a loan so there are no interest or finance charges, simply a low annual enrollment fee. Check with the school you will be attending to see if they offer Monthly Payment Plans.

Parental Loan for Undergraduate Students (PLUS)
Although the PLUS loan is a federally guaranteed loan, many students do not realize it is an option for parents who are willing to help finance their education. The Federal PLUS Loan is not based on financial need, so parents do not need to complete a FAFSA prior to applying. Qualifying for a Federal PLUS Loan is based on credit-worthiness, with no debt-to-income ratio guidelines or employment verification requirements.

Similar to the Federal Stafford Loan application process, parents and students must complete the Federal PLUS Loan Master Promissory Note (MPN), and designate a lender. This procedure may be available online depending on the school you're attending. If you fill out a paper application, your school's Financial Aid Office will provide you with an address for you to forward the completed application (either back to the FA Office, or your school's designated loan processor).

If the loan is approved, funds are made payable to the school and the parent. Disbursement is usually done in two or more equal installments at the beginning of each semester and is sent directly to the school.

Home Equity Lines and Loans
Another option for parents who are willing to help finance their child's education is a home equity line or loan. Parents with equity in their home are eligible to borrow. Approval is based on additional factors including credit history and debt-to-income ratio. Interest paid on these loans may be tax deductible. Please consult your tax advisor for details. For information on using Citizens Bank Home Equity lines and loans to help finance your child's education call 1-800-340-LOAN.

Alternative Loan Options for Students
Alternative student loans are private loan programs available to families after all other financing options have been considered. Most loan programs require an established good credit history therefore a co-signer is often recommended. Typically the student can borrow up to the cost of education less any other financial aid. International students can also apply for these loans with a US citizen or permanent resident co-signer. Many lenders offer borrower benefits such as a co-signer release option, no pre-payment penalty and interest rate reductions for payments automatically deducted from your bank account.

Need Help?
If you need help or more information about financing alternatives please contact one of our Education Finance Specialists at 800-708-6684. We provide expert personal assistance—every step of the way—to help you make the right decisions and reach your education goals!