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At NerdWallet, we strive to help you make financial decisions with confidence. To do this, many or all of the products featured here are from our partners. However, this doesn't influence our evaluations. Our opinions are our own.

Use this calculator to estimate your monthly payments on federal direct PLUS loans. You can also see the total you'll repay, including interest.
" MORE: Parent PLUS loan repayment: 5 manageable options
How to use this calculator

Enter the interest rate for the PLUS loan. Your interest rate will vary depending on the year you borrow. The current rate for 2019-20 PLUS loans is 7.08%.

Include the origination fee for your PLUS loan. In 2018-19, the fee is 4.248% of the total amount borrowed for loans made on or after Oct. 1, 2018, and before Oct. 1, 2019.

Understanding your results

Use your results to save money

You can submit more than your monthly minimum to pay off your loan faster. The quicker you finish paying your loans, the more you'll save in interest. Learn how to pay off your loans fast.

You have five PLUS loan repayment options.

Other student loan calculators

Student loan payoff calculator: Use this calculator to find your debt-free date, and see how extra payments can speed that up.

Student loan refinance calculator: Use this calculator to compare your current loan payment or multiple payments with a refinanced student loan.

Student loan consolidation calculator: Use this calculator to compare your payments under federal loan consolidation plans with your current bills.

Daily student loan interest calculator: Use this calculator to estimate the amount of interest that your loan accrues daily and between payment periods.

Student loan affordability calculator: Use this calculator to determine an affordable monthly student loan payment and how much that allows you to borrow.

Discretionary income calculator: Use this calculator to determine what you would pay under federal income-driven repayment plans.

Weighted average interest rate calculator: Use this calculator to determine the combined interest rate on all your student loans. You'll need that average to estimate your loan payments under federal loan consolidation programs or to compare student loan refinancing offers.

About the author

Anna is a writer and NerdWallet's authority on student loans. Her work has appeared in The Associated Press, The New York Times, The Washington Post and USA Today. Read more

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Parent PLUS Loan Calculator - NerdWallet

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At NerdWallet, we strive to help you make financial decisions with confidence. To do this, many or all of the products featured here are from our partners. However, this doesn't influence our evaluations. Our opinions are our own. Use this calculator to estimate your monthly payments on federal direct PLUS loans.

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Do It Yourself College Rankings | How to Budget & Pay For College

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A financial aid gap occurs when a college's financial aid award for a student doesn't meet the student's financial need as defined by the college. This unmet need is referred to as the gap.

Gapping became a verb as some colleges have earned a reputation for failing to meet student need, especially students admitted with qualifications placing them in the middle to bottom of the class. Students in the bottom quarter of a class in terms of qualification are always at risk of being gapped with the exception of the most competitive institutions that meet 100% of need.

The financial aid gap is a serious concern because the student and family will be responsible for the unmet need in addition to the Expected Family Contribution (EFC). Usually, students with gaps will be unable to use federal loans to help cover the gap or the EFC because the college has assigned it to cover part of the defined financial need.

Often, students may not realize that they have been gapped because the financial aid award letter will have the amount covered by a PLUS loan. However, a PLUS loan is money borrowed by the parents and should not be considered part of the college's financial aid award.

Learn More:

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A financial aid gap occurs when a college's financial aid award for a student doesn't meet the student's financial need as defined by the college. This unmet need is referred to as the gap. Gapping became a verb as some colleges have earned a reputation for failing to meet student need, especially students admitted with qualifications placing them in the middle to bottom of the class.

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Back when you signed the dotted line and took out your student loans, how well did you understand the terms? Maybe things were a little fuzzy, but you knew you needed the loans to pay for college.

Student loan interest is one of the more complicated aspects of student loans. How interest rates are set, how interest accrues, and how payments are divided between your principal balance and interest charges can be difficult to grasp.

But understanding how student loan interest works is an important step in managing your debt.

How does student loan interest work?

When new student loans are issued, the borrower signs a promissory note that explains the terms of the loan. Every part of this document is important to read and understand, as it determines how much you owe and when your payments are due.

The most important terms to look out for are:

Issue date: The date your loan starts to accrue interest

Amount borrowed: The total amount borrowed in each loan

Interest rate: How much you have to pay to borrow the funds

How interest accrues: Whether interest is charged daily or monthly

First payment date: When you have to make your first loan payment

Payment schedule: How many payments you have to make

Lenders understand that most full-time students do not have an income, and if they do, it is not enough to cover student loan payments while in school. Because of that, many student loans are subsidized by the federal government. That means you do not accrue interest while still in school.

Unsubsidized loans, meanwhile, charge interest from the day the loan is issued.

Why is this important? Knowing whether your loans are subsidized or unsubsidized tells you if your balances will grow while you're in school.

How is student loan interest calculated?

Your required loan payment will be the same each month. However, when you make a payment, interest is paid first. The remainder of your payment is applied to your principal balance.

Student loan interest typically accrues daily, according to the daily simple interest formula. If you take your current principal balance and multiply it by your interest rate, then divide by 365 days, you'll see how much interest your debt accrues every day.

For example, say you have a balance of $10,000. Multiply that by a hypothetical interest rate of 4.29% (0.0429) and divide by 365. In this case, you'd accrue $1.175 in interest every day.

If you pay your bill once per month, your payment is applied to that accrued interest first - about $35 in our example. The rest of your payment lowers your outstanding principal balance.

How is student loan interest applied?

As you make payments on your student loan, your balance and the amount of interest you accrue will drop. With lower interest charges, more of your payments are applied to your principal. Over the life of your loan, your interest paid will decline each month, which accelerates your principal payment. That's how amortization works.

Remember, interest is always paid first. If you have an unsubsidized loan or are past the subsidy period, your loan payoff date requires you to make the same minimum payment each month. If you are on a payment plan or have deferred payments, interest will continue to accrue. This amount is added to your principal, increasing your student loan balance.

If you are able, you should always pay at least the interest each month. If you don't, your loan balance will continue to grow and you will owe interest on the interest you didn't pay in previous months.

Further, making partial payments will count as a missed or late payment on your credit report and may cause you to go into loan default, which is not a good thing.

If you are struggling to make payments and can't figure out a way to afford them, you can look into an income-driven repayment plan. The REPAYE program, for example, limits your payments to 10 percent of your discretionary income.

This loan payment calculator can quickly tell you how much of your payments are going toward interest and principal each year.

How are extra student loan payments treated?

When you make your monthly payment, you are given the option to pay extra. If you do, that extra payment is applied directly to the principal, which will reduce your interest in the future.

Any other extra payments made throughout the month are treated as normal payments. That is, your payment is first applied to interest you accrued since your last payment and then your principal.

Don't underestimate the power of early payments. Paying an extra $50 or $100 each month can save you thousands of dollars in interest depending on your loan terms. Check out the student loan prepayment calculator to see how much you can save by paying a little more every month.

When I was still making student loan payments, I lived on a budget that allowed me to make a full payment each payday. Paying double each month helped me pay down my balances quickly, and I was able to make my final payment exactly two years and six days after graduation.

Putting off payments or just making the minimum each month will leave you with a big interest cost over the life of your loan. Use your new knowledge of how student loan interest works to pay off your loans early. You work hard for each paycheck. Pay more today so you can save big later.

Interested in refinancing student loans?

Here are the top 6 lenders of 2018!

Advertiser Disclosure

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Here's Exactly How Student Loan Interest Works | Student Loan Hero

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Back when you signed the dotted line and took out your student loans, how well did you understand the terms? Maybe things were a little fuzzy, but you knew you needed the loans to pay for college. Student loan interest is one of the more complicated aspects of student loans.

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Check out our reviews!
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Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers. If approved, your actual rate will be within a range of rates and will depend on a variety of factors, including term of loan, a responsible financial history, income and other factors. Refinancing or consolidating private and federal student loans may not be the right decision for everyone. Federal loans carry special benefits not available for loans made through Splash Financial, for example, public service loan forgiveness and economic hardship programs, fee waivers and rebates on the principal, which may not be accessible to you after you refinance. The rates displayed may include a 0.25% autopay discount

The information you provide to us is an inquiry to determine whether we or our lenders can make a loan offer that meets your needs. If we or any of our lending partners has an available loan offer for you, you will be invited to submit a loan application to the lender for its review. We do not guarantee that you will receive any loan offers or that your loan application will be approved. Offers are subject to credit approval and are available only to U.S. citizens or permanent residents who meet applicable underwriting requirements. Not all borrowers will receive the lowest rates, which are available to the most qualified borrowers. Participating lenders, rates and terms are subject to change at any time without notice.

To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

Splash Financial and our lending partners reserve the right to modify or discontinue products and benefits at any time without notice. To qualify, a borrower must be a U.S. citizen and meet our lending partner's underwriting requirements. Lowest rates are reserved for the highest qualified borrowers. This information is current as of June 1, 2021.

² Rate range above includes optional 0.25% Auto Pay discount. .

Interest Rate Disclosure
Actual rate and available repayment terms will vary based on your income. Fixed rates range from 2.48% APR to 5.79% APR (excludes 0.25% Auto Pay discount). Variable rates range from 1.88% APR to 5.64% APR (excludes 0.25% Auto Pay discount). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 36% (the maximum allowable for these loans). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 2.04% and 5.8% to the one month LIBOR. Earnest rate ranges are current as of 6/8/2021, and are subject to change based on market conditions.
Auto Pay Discount Disclosure
You can take advantage of the Auto Pay interest rate reduction by setting up and maintaining active and automatic ACH withdrawal of your loan payment. The interest rate reduction for Auto Pay will be available only while your loan is enrolled in Auto Pay. Interest rate incentives for utilizing Auto Pay may not be combined with certain private student loan repayment programs that also offer an interest rate reduction. For multi-party loans, only one party may enroll in Auto Pay.
Student Loan Refinancing Loan Cost Examples
These examples provide estimates based on payments beginning immediately upon loan disbursement. Variable APR: A $10,000 loan with a 20-year term (240 monthly payments of $72) and a 5.89% APR would result in a total estimated payment amount of $17,042.39. For a variable loan, after your starting rate is set, your rate will then vary with the market. Fixed APR: A $10,000 loan with a 20-year term (240 monthly payments of $72) and a 6.04% APR would result in a total estimated payment amount of $17,249.77. Your actual repayment terms may vary.Terms and Conditions apply. Visit https://www.earnest. com/terms-of-service, e-mail us at [email protected] , or call 888-601-2801 for more information on our student loan refinance product.

Earnest Loans are made by Earnest Operations LLC or One American Bank, Member FDIC. Earnest Operations LLC, NMLS #1204917. 535 Mission St., Suite 1663, San Francisco, CA 94105. California Financing Law License 6054788. Visit earnest.com/licenses for a full list of licensed states. For California residents (Student Loan Refinance Only): Loans will be arranged or made pursuant to a California Financing Law License.

One American Bank, 515 S. Minnesota Ave, Sioux Falls, SD 57104. Earnest loans are serviced by Earnest Operations LLC with support from Navient Solutions LLC (NMLS #212430). One American Bank and Earnest LLC and its subsidiaries are not sponsored by or agencies of the United States of America.

© 2021 Earnest LLC. All rights reserved.

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Offered terms are subject to change and state law restriction. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900), NMLS Consumer Access. If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. ‍All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 0.15% effective Jan 1, 2021 and may increase after consummation.

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All credit products are subject to credit approval.

Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation's largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit www.laurelroad.com.

As used throughout these Terms & Conditions, the term "Lender" refers to KeyBank National Association and its affiliates, agents, guaranty insurers, investors, assigns, and successors in interest.

1. Checking your rate with Laurel Road only requires a soft credit pull, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.

2. Savings vary based on rate and term of your existing and refinanced loan(s). Refinancing to a longer term may lower your monthly payments, but may also increase the total interest paid over the life of the loan. Refinancing to a shorter term may increase your monthly payments, but may lower the total interest paid over the life of the loan. Review your loan documentation for total cost of your refinanced loan.

3. After loan disbursement, if a borrower documents a qualifying economic hardship, we may agree in our discretion to allow for full or partial forbearance of payments for one or more 3-month time periods (not to exceed 12 months in the aggregate during the term of your loan), provided that we receive acceptable documentation (including updating documentation) of the nature and expected duration of the borrower's economic hardship. During any period of forbearance interest will continue to accrue. At the end of the forbearance period, any unpaid accrued interest will be capitalized and be added to the remaining principle amount of the loan.

4. Automatic Payment ("AutoPay") Discount: if the borrower chooses to make monthly payments automatically from a bank account, the interest rate will decrease by 0.25% and will increase back if the borrower stops making (or we stop accepting) monthly payments automatically from the borrower's bank account. The 0.25% AutoPay discount will not reduce the monthly payment; instead, the discount is applied to the principal to help pay the loan down faster.

Assumptions: Repayment examples above assume a loan amount of $10,000 with repayment beginning immediately following disbursement. Repayment examples do not include the 0.25% AutoPay Discount.

Annual Percentage Rate ("APR"): This term represents the actual cost of financing to the borrower over the life of the loan expressed as a yearly rate.

Interest Rate: A simple annual rate that is applied to an unpaid balance.

Variable Rates: The current index for variable rate loans is derived from the one-month London Interbank Offered Rate ("LIBOR") and changes in the LIBOR index may cause your monthly payment to increase. Borrowers who take out a term of 5, 7, or 10 years will have a maximum interest rate of 9%, those who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.

KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.

This information is current as of April 29, 2021. Information and rates are subject to change without notice.

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Fixed rates from 2.49% APR to 6.94% APR (with autopay). Variable rates from 2.25% APR to 6.59% APR (with autopay). All variable rates are based on the 1-month LIBOR and may increase after consummation if LIBOR increases; see more at SoFi.com/legal/#1. If approved for a loan your rate will depend on a variety of factors such as your credit profile, your application and your selected loan terms. Your rate will be within the ranges of rates listed above. Lowest rates reserved for the most creditworthy borrowers. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi loans are originated by SoFi Lending Corp. or an affiliate (dba SoFi), a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license #6054612; NMLS #1121636 ( www.nmlsconsumeraccess.org). Additional terms and conditions apply; see SoFi.com/eligibility for details. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.

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Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.

Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised variable APR is only available for loan terms of 5 years and is reserved for applicants with FICO scores of at least 810.

As of 04/07/2021 student loan refinancing rates range from 1.90% APR - 5.25% Variable APR with AutoPay and 2.49% APR - 7.75% Fixed APR with AutoPay.

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Annual Percentage Rate (APR) is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Fixed Rates range from 2.89%-4.78% APR and Variable Rates range from 2.13%-5.25% APR. Both Fixed and Variable Rates will vary based on application terms, level of degree and presence of a co-signer. These rates are subject to additional terms and conditions and rates are subject to change at any time without notice. For Variable Rate student loans, the rate will never exceed 9.00% for 5 year and 8 year loans and 10.00% for 12 and 15 years loans (the maximum allowable for this loan). Minimum variable rate will be 2.00%. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.

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Check out our reviews! 1 . Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S.

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Financial Aid Checklist - Paying for College

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These checklist offer a step-by-step guide to help you navigate the financial aid process and get the most money possible for college.

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Financial aid packages are designed to level the playing field, when it comes to education. By providing students with a bit of a financial boost, the administrators of financial aid packages hope to ensure that even students from the poorest families can get a good education, so they can get the opportunities that allow them to change the fortunes of the family for good.

Types of Financial Aid

When people think about financial aid programs, they tend to think about full-ride academic scholarships offered by colleges to needy but gifted students. While these programs do exist, there are many other types of financial aid programs, including:

Some of these financial aid products require students to enroll for a specific number of credits each term or complete a certain number of tasks on a weekly basis. Others require students to pay back a portion of the money a student receives for school. Understanding the details of each product is vital, as it can help students to stay in compliance and avoid financial penalty.

While the federal government is the source of the majority of aid provided to students, there are other entities that also provide aid.

Source: As reported by the College Board.

Amount of Aid Received

While students might be curious about the kinds of aid available and the ways in which aid programs work, they may be most curious about how much money they can expect to receive. While the answer might vary, depending on the student and that student's situation, there are some statistics that can help to illuminate the issue.

Schools may also provide financial aid, and as a profile of grants for law schools, published by U.S. News and World Report demonstrates, the award amounts can vary dramatically based on the school the student chooses.

Even the state a student lives in could have a huge impact on the amount of financial aid available, as these statistics from the Brookings Institute demonstrate.

Understanding the Gap

Source: U.S. Department of Education

Getting the Most Aid Possible

Almost all sources of financial aid rely on the Free Application for Federal Student Aid (FAFSA) in order to determine a student's financial need and eligibility for aid. Filling this form out is the first priority for almost all students when the new year rolls around, but as this chart from the U.S. Department of Education demonstrates, some students wait far too long before they begin their work.

One Third
One-third of students fill out a FAFSA in the first quarter

Three Fifths
Three-fifths of applications are complete by the second quarter

Five Sixths
Five-sixths are complete by the end of the third quarter

Handling Disappointment

If students are provided with financial aid packages that don't cover all of the expenses a family might anticipate, there are some things families can do. These steps may help:

Schedule a meeting with the financial aid officer, and bring all pertinent financial documents to that meeting.

Be polite, but firm, about the family's need for additional aid.

Show documentation from other schools, if the student's been provided a more generous financial package at a different institution.

Follow up the meeting with an email message, reiterating key points.

Fill out formal appeal paperwork, if applicable.

While smaller schools may not be able to play ball on financial packages, some larger schools may be open to negotiation, so discussing the issue diplomatically could deliver big results.

Videos

Should I take out a private student loan?

In this video, Monisha Perkash talks about the proper role of private student loans in the paying-for-college process. Private loans should only be used once all other financial aid options have been exhausted, so make sure that you've explored federal and school-specific options before turning to a private student loan. If you do need a private student loan, be sure to compare carefully and borrow only what you need - no more.

Do you know what kinds of student loans you have?

College on the Cheap's street team interviewed some college students and asked them a few questions about loans, including what the difference is between subsidized and unsubsidized loans, whether you should take out aprivate student loan or federal student loan first, and some basics about Stafford Loans. Their answers weren't always spot-on, but definitely entertaining.

FAQ

Frequently Asked Questions
How do I qualify for student financial aid?
In order to qualify for student financial aid, your financial information must display a serious financial need. As one might expect, applicants with the highest need for finances are awarded the most financial aid. Others who demonstrate less need are awarded a smaller portion according to their need. Other than that, you need to make sure that you are a legal U.S. citizen with a SSN, have not defaulted on any other loan, and have completed a minimum of high school education.
What are the different types of financial aid?
The various types of financial aid programs include federal financial aid, institutional financial aid, and private financial aid. Federal financial aid is the most sought after source of funding for students since federal loans have the lowest interest rates and the most lenient terms and conditions. Institutional aid is mostly awarded to students with outstanding academic achievements or with extreme financial need. Private financial aid programs are stringent in terms and conditions and often have high interest rates. It is recommended that students utilize federal financial aid first, and if it does not fully cover the applicant's need, only then should students look to other types of financial aid.

When should I file the financial aid forms?
The earliest you can file the FAFSA is January 1st of senior year in high school, so you will want to file soon as possible after that date. The PROFILE can be sent in at any time, so filing early - before January 1st - is advisable.

If you anticipate qualifying for need-based financial aid, you must file no later than March 1st. Many states and most colleges use the March 1st filing deadline to close eligibility for state and campus-based aid. By missing that date, you may be ineligible for those kinds of aid, your need notwithstanding. Do not miss this deadline.

How can I complete a financial aid form if my taxes aren't done?
Make a reasonable estimate based on last year's tax return, and send the form(s) in as early as possible to stake your place at the front of the financial aid line. You can update your form with more accurate information later without losing your place in line, so there's no harm in filing early.

Is it better to file electronically or by regular mail?
We urge you to file the FAFSA electronically; for those of you who have to complete the CSS/PROFILE, that form must be filed electronically. Electronic filing is faster, more responsive, and easier for the colleges to process. If you file by regular mail, be sure to make a copy of the form and get a Certificate of Mailing at the post office to verify the mailing date. Don't lose the certificate, and do not use Certified or Registered Mail or anything that requires a signature at the point of destination.

I just received something from IDOC. What is it?
A growing number of colleges use a service called IDOC. Using tax return data, it informs the college principally about actual cash flow by looking for "phantom losses" on the tax form. The IDOC tends to discount things like depreciation and carryover losses from stock sales and other transactions.

What happens if my family owns a business or farm?
The relevant information will be included on the FAFSA, but if you file a PROFILE, you will be asked to complete a Business/Farm supplement similar to a multi-year Schedule C on your 1040.

What if the current year's income is going to be different from the one (last year's income) I reported on the financial aid forms?
If your current income goes up, wait until the end of the calendar year to report it on the next FAFSA and PROFILE. If your income goes down, once the student gets admitted, contact the college's financial aid office to discuss the EFC given your new, lower, income. They will guide you through the appeal process.

Related Articles

Financial Aid Applications
Financial Aid Awards

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The Basics of College Financial Aid | SimpleTuition

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Financial aid packages are designed to level the playing field, when it comes to education. By providing students with a bit of a financial boost, the administrators of financial aid packages hope to ensure that even students from the poorest families can get a good education, so they can get the opportunities that allow them to change the fortunes of the family for good.

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A longer application season - now beginning on Oct. 1 - means FAFSA filing time has arrived for families who want to learn earlier about college financial aid for the 2017-18 academic year.

The Free Application for Federal Student Aid, or FAFSA, determines which students qualify for federal grants, student loans and work-study jobs, as well as eligibility for many private awards.

Financial aid from federal and college sources is most often awarded in the order in which the forms are submitted, so file as soon as you can. Here's how to get the most from your FAFSA.

Understand the basics

The purpose of the FAFSA is to calculate your expected family contribution, or EFC - the amount the government believes your family can contribute for college that year.

Based primarily on your family's income and assets, the EFC qualifies students for federal grants, loans and work-study programs. It's also one of the primary factors used by colleges to determine how much your family can pay when set against the cost of that school and how much the college will contribute to your total aid package.

ADVISER SEARCH: Saving for your child's college? Search today for a financial adviser who can help.

"Everyone should fill out the FAFSA," says Beth V. Walker, founder of College Funding Coaches, a college finance planning firm headquartered in Colorado Springs, Colorado. "There are a lot of parents who think they make too much money and that they're not going to qualify for anything, but I think it's a surprise to many people to know that the merit-based aid is handed out many times through the need-based door."

While most families can't change their income, they can maximize their federal aid eligibility by filing the FAFSA as early as possible and by transferring or spending assets held in the student's name.

Dependent undergrads, regardless of their family's income, can receive up to $23,000 in subsidized Stafford loans over 4 years, reports the U.S. Department of Education, while families with adjusted gross incomes of $40,000 or less can usually expect some federal grant aid, says Walker.

Unlike student loans, grants need not be repaid, though some conditions may apply. Before filing, families can get an estimate of their EFC by using the "FAFSA4caster" tool at FAFSA.ed.gov.

RATE SEARCH: Find high-rate IRA money market accounts today.

Documents you need before you start the FAFSA

The loopholes

Families can take action to receive as much aid as they possibly can. While most families can't change their income, they can maximize their federal aid eligibility by filing the FAFSA as early as possible and by transferring or spending assets held in the student's name.

"Student assets are assessed at 20%," says Jay Murray, president of Solutions for Tuition, a college planning firm in Lone Tree, Colorado, meaning that for every dollar in an account in a student's name, the government will subtract 20 cents from the student's aid package. This starts with need-based grants. "Parental assets are assessed at (up to) 5.6%."

The exception, Murray says, is 529 plans. These are assessed at the parental rate whether they're held in a parent's or student's name.

Gary Carpenter, executive director of the National College Advocacy Group, a nonprofit organization in Syracuse, New York, says families can also boost their aid eligibility by knowing which assets the government doesn't take into account.

"The FAFSA form does not assess the family home. It does not assess retirement accounts. It does not assess life insurance policies or annuities," says Carpenter. "Also, they do not assess personal assets like automobiles, clothing, furniture -- none of that is assessed."

Smart moves

Families looking to transfer assets from assessable accounts to sheltered ones can do so by:

Maxing out their retirement accounts.

Paying down the mortgage on their primary home.

Purchasing personal items the student will need before filing the FAFSA.

These personal items can include a computer or dorm supplies. Families who need those assets to be available for college costs can simply move funds from an account in the student's name to a 529 plan or one held in the parent's name.

When circumstances change

Sandy Baum, a senior fellow at the Urban Institute, adds that students also should alert their school's financial aid office about expenses that aren't considered on the FAFSA.

"For example, if you fill out (the FAFSA) and your parents made a reasonable income last year and then they lose their jobs, you want to be sure you go to the financial aid office," she says. "Tell them this because they can adjust your aid award to account for those unfortunate new circumstances. That's terrifically important."

By letting your aid office know about factors that aren't included on the FAFSA, such as medical expenses, death in the family, divorce or parental job loss, and by providing documentation, families can keep aid officers abreast of their current financial situation and boost their chances of receiving college aid.

ADVISER SEARCH: Search now for a financial adviser in your area.

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A longer application season - now beginning on Oct. 1 - means FAFSA filing time has arrived for families who want to learn earlier about college financial aid for the 2017-18 academic year. The Free Application for Federal Student Aid, or FAFSA, determines which students qualify for federal grants, student loans and work-study jobs, as well as eligibility for many private awards.

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Pay for College - Compare Aid Calculator

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Perform a side-by-side comparison of financial aid packages.

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FinAid | Calculators | Award Letter Comparison Tool

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Credit scores were never meant for consumers.

Implemented in the 1980s for lenders and banks to provide an algorithm-based assessment of consumers' creditworthiness, the clandestine, proprietary credit score models are the credit industry's secret sauce and they're selling it to every bank and lender on the market.

So it's no surprise that most consumers have outstanding misconceptions about their credit, especially when it comes to what hurts and helps credit scores. In fact, a recent survey found that 42 percent of Americans would prefer a letter grade associated with a credit score rather than the traditional three-digit number. A letter grade would presumably help consumers better grasp where they rank in creditworthiness.

And most Americans are ranking pretty low. With the average credit score at 661 nationwide, according to CreditKarma.com, a majority of Americans have poor credit, which means most consumers would be hard-pressed to find approval on mortgages, loans and credit cards; if they are approved, it's likely at exorbitant rates.

Polishing up your credit starts with understanding the ins and outs of credit scores. Here's your cheat sheet to debunking the top myths about credit.

1) FICO is the one, true credit score. While the FICO credit score is widely known, there is no one true credit score. There are dozens of credit score models generated by each credit bureau and unique to different industries like mortgage lenders and auto insurance providers. Risk assessment isn't consistent from industry to industry or even lender to lender. For example, your credit score pulled by one credit card issuer is likely to differ anywhere from 5 to 50 points from another credit card issuer.

Lesson: You can't predict what credit score a lender will assess you by until after they pull the score. Since you can't keep track of dozens of scores, track one credit score, such as the free credit score provided by CreditKarma.com, for a general sense of your credit health. While the actual numbers may vary, you're often in the same "risk range" from credit score model to credit score model. As you build and improve the factors affecting your credit score, your scores should pick up across the whole spectrum of scoring models.

2) Checking your score is bad for your credit. There are two types of credit checks. Hard inquiries knock a few points off your credit score and are initiated when a financial institution pulls your credit report to assess you for a lending decision, such as approval for a mortgage or credit card. Soft inquiries do not affect your credit and are initiated as part of a background check, such as for pre-approved offers or as part of a job hiring process. When you check your own credit score, it is considered a soft inquiry and won't affect your credit score no matter how many times you check your score.

Lesson: Go ahead and check your credit score as often as you'd like; you have nothing to lose and tracking your progress over time will give you more insight into what's affecting your credit.

3) My credit score affects future job opportunities. Contrary to popular belief, potential employers don't look at your credit score; they actually pull your credit report, which is a data-rich document detailing your credit history. Employers look at your credit report as part of your background check, but they must get your permission before doing so. Take the preemptive step to review your full credit report for free at AnnualCreditReport.com, which provides you with a free credit report once a year from each of the three credit bureaus. Regularly check your credit report throughout the year by spacing your free credit reports every four months.

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The Top 6 Misconceptions About Credit Scores

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Credit scores were never meant for consumers. Implemented in the 1980s for lenders and banks to provide an algorithm-based assessment of consumers' creditworthiness, the clandestine, proprietary credit score models are the credit industry's secret sauce and they're selling it to every bank and lender on the market.

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The typical college student has a lot to worry about - paying for school, classwork, holding down a job, and of course that little issue of figuring out what to do with your life.

A good credit score might not be too high on the priority list for most college students. In fact, the average credit score for someone 18 to 24 years old is 630, according to CreditKarma, and that's not great. Credit requirements vary by lender, but a score below 650 is generally considered bad, according to USA Today, while a good credit score is 730 or higher.

Not to pile one more thing on the list, but your credit report and credit score will play important roles in your life, and college is the perfect time to start improving them.

Start Thinking About Good Credit in College

Your credit report is going to determine a lot for you. The misconception is that you're only going to need good credit way down the road - such as when you're ready to buy a home, which can seem like an eternity away when you're in college.

However, your credit can impact you right now, determining your interest rate for student loans. Plus, if you're thinking about consolidating your loans after graduation, a good credit report could land you a better interest rate.

Employers can look at your credit report and score when deciding whether to hire you. And if you'll need a car to get to that job, you're going to need a good credit history to get an auto loan.

That post-college apartment? Odds are your potential landlord is going to look at your credit report to see whether you'd make a responsible tenant. Or the landlord may require an additional security deposit if have no or poor credit.

Besides those immediate needs for good credit, building a solid credit history early is going to give you a jump start down the road. According to FICO, 15% of your credit score is based on the length of your credit history. So the earlier you begin building your credit, the better off you'll be.

The Dos and Don'ts of Credit Cards in College

Getting a credit card is one of the quickest ways to build credit in college. But here are some dos and don'ts you need to know:

DO Choose a Card That's Right for You

Used properly, credit cards can have a lot of benefits. Many offer some type of fraud protection, for example, unlike a debit card. Before you apply, research what is offered to know what's best for you. Here are a few cards to consider:

Discover it® chrome for Students allows you to pay your bill up to midnight the day it's due, so it could accommodate your hectic schedule. You won't have to pay a late fee on your first missed payment, which is a benefit for those who aren't used to paying a credit card bill every month. Also, your FICO® Credit Scores for free on statements & online every month so you can monitor how your credit is improving.

Journey® Student Rewards from Capital One® is great if you plan to study abroad since there's no foreign transaction fee (the Discover Student Card doesn't have one either). Plus, earn 1% cash back on all your purchases. Pay on time to boost your cash back to a total of 1.25% for that month and apply it directly to your student loans.

Bank of America® Cash Rewards Credit Card You'll earn 1% cash back on every purchase, 2% at grocery stores and 3% on gas for the first $2,500 in combined grocery/gas purchases each quarter. Get a 10% customer bonus every time you redeem your cash back into a Bank of America® checking or savings account

U.S. Bank College Visa® Card sends personalized mobile alerts with upcoming payments and balance.

Citi Thank You® Preferred Card for College Students will search for a lower price on items you bought for 60 days, and if a better deal is found, you can get a refund.

DON'T Apply for Multiple Accounts at Once

This can lower your credit score since new credit inquiries make up 10% of your score. Instead, wait for a card with benefits and perks you can use, no annual fee, and a low interest rate.

DO Pay Off Your Balance Every Month

Just because you have a credit card doesn't mean you should live outside your means. You should only be charging everyday purchases you'd be making anyway, such as groceries, gas, cellphone bill, cable bill, or anything else you were already planning on buying.

Create a budget based on your income and expenses and stick to it. Pay your balance off every month to avoid debt accruing, paying interest, and hurting your credit. In 2013, the average college graduate left school with $3,000 in credit card debt, according to CNN Money.

DON'T Let Your Card Sit in a Drawer

To build credit, you have to use your card. Simply having a credit card won't build your credit alone. You need to have a payment history, so make a small purchase every now and then and immediately pay if off.

DO Make Your Payments on Time

This is imperative, since 35% of your credit score is based on payment history. Consider setting up automatic payments to avoid a late payment. Set up an alarm on your phone, write it on your calendar, and enroll in text and e-mail reminders if available.

DON'T Open and Close Accounts Frequently

Take time to research benefits to each credit card so you're not tempted to jump around and open a new account. It's recommended that you keep your oldest credit card open to show a long length of account duration, which benefits your credit. Closing an account may shorten your credit history and reduce your available credit, both of which can lower your score.

DO Consider Other Types of Cards if You Can't Qualify for a Traditional Credit Card

The Credit Card Accountability Responsibility and Disclosure Act of 2009, also known as the CARD Act, makes it harder for anyone under 21 to apply for credit without a co-signer or proof of a full-time income. However, there are other options for a credit card if you can't qualify for a traditional one or get a co-signer.

A secured credit card is offered through banks and is associated with a savings account you have. You put a specific amount in a savings account associated with the card, and that amount is your credit limit. Often credit cards from a retail store or gas station have different restrictions, so they might be easier to acquire.

DON'T Let Your Balances Grow

Regardless of the type of card you have, keep your balance something you can pay off every month to avoid paying interest and accruing debt. Thirty percent of your credit score is based on the amount owed, so those big balances are only going to hurt you in the end.

DO Apply for a Credit Card at Your Bank

Besides a secured credit card or a retail or gas credit card, another option is applying for a credit card with a bank where you already have a checking or savings account. If you have a savings and checking account along with a history of not letting your balances go below the account minimums or getting overdraft fees, you might be more likely to get approved.

Other Ways to Build Credit in College

If you don't have any income in college, would be unable to pay the balance on a credit card, or simply can't get approved for one, there are other ways to build your credit in college without credit cards:

Become an Authorized User on Your Parents' Credit Cards

If you don't want to or can't open your own credit card account, consider asking your parents to add you as an authorized user on their cards. If they have good credit, you'll be piggybacking off their positive credit history, which can boost your score.

Choose Responsible Roommates

If you decide to live in an off-campus apartment, choose responsible roommates you can trust. Since your name is on the lease and you're paying utilities together, it will hurt your credit if they're missing payments or not turning in the rent on time.

Pay Your Bills on Time

Just like with credit cards, this is imperative. Missed or late payments from your Internet, cable, or cellphone bill can damage your credit report. Even things like doctor bills, unpaid library fees, parking tickets, or school fees not covered by loans could get sent to collections and harm your credit.

Don't Co-Sign for Your Buddies

There are plenty of ways to be a good friend in college, but co-signing for anything should not be one of them. The second your friend misses a payment, your credit is negatively impacted. Regardless how responsible a friend is or how secure their job seems, you can't control if they stop paying down the road.

Check Your Credit Report

Keep an eye on your credit. Annualcreditreport.com allows you to check your credit report from each of the three main credit reporting agencies once per year. Space it out so you're checking each report once per year.

Monitoring your report is essential in building a good credit history. You might see an account you didn't open or other suspicious activity that turns out to be identity theft. The sooner you report this, the sooner you can have it removed from your report and improve your credit history.

Besides identity theft, it's also a good idea to monitor for mistakes. There could have been a glitch in a company's system that reported your payment as late when it really wasn't, for example.

Reduce Your 'Hard Inquiries'

As mentioned above, applying for several new accounts at once can harm your credit. If you're looking for a private student loan or if you're shopping for a car, do your searching within a 14-day period. Anything within this time frame will count as one inquiry and harm your credit less.

Protect Your Identity

Even if you know the people you live with very well, you don't have control over their guests when you're not around. Keep your Social Security card, bank account information, driver's license, and other important documents in a secure, safe place that people can't access.

When using a public computer or an unsecured wireless network, as is common in college, avoid paying bills, shopping online, or other activities that could leave you vulnerable to someone using your accounts or information to open their own account.

Keep Your Information Up to Date

You may move multiple times while you're in college. Any time you move, be sure to change your address on all your accounts and with any bills you pay. You can also have your mail forwarded in case something slips by you. Bills going to the wrong address could mean missed payments, late fees, and a negative result on your credit.

Besides changing your address when you move, also be sure to cancel all your accounts associated with that address or remove your name from any accounts shared with roommates, such as utilities, cable, Internet, and of course, the apartment lease.

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How to Build Good Credit in College - The Simple Dollar

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The typical college student has a lot to worry about - paying for school, classwork, holding down a job, and of course that little issue of figuring out what to do with your life. A good credit score might not be too high on the priority list for most college students.

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You always hear how important it is to know your credit score and maintain a good one. But with so much information out there, you're probably wondering "how do credit scores work?" and don't know where to start.

The following is everything you need to know about credit scores, why you should care about them, and how you can use them to reach your financial dreams. Let's get to it.

What is a credit score?

Lenders developed credit scores to help them understand the level of risk certain borrowers might present.

They start by measuring a certain number of credit criteria (detailed below), and from that borrowers are given a three-digit score.

A lot of people try to strive for the "perfect" credit score. They assume that's a goal that can unlock all of their financial wishes. But this is a pointless endeavor.

That's because what many of those same people don't know is that we all have more than one credit score. That's why it's more helpful to focus on the range that your credit score falls into rather than the credit score itself.

However, before we get to that, it's important to understand that credit scores and credit reports are not the same.

A credit report is a listing of your financial accounts and the details thereof. According to MyFico, this includes:

What types of credit you use.

The length of time your accounts have been open.

Whether you've paid your bills on time.

Your address.

Whether you've been sued or arrested, or have filed for bankruptcy.

A credit score, on the other hand, is simply a numerical illustration of your creditworthiness. While the score is based on information on your credit report, your credit score is not listed on your credit report.

Therefore, consider these to be two separate things, but working on one will improve the other.

How do credit scores work?

There are two major credit scores, FICO and VantageScore. And there are five factors that make up how these scores are calculated. However, what affects your credit score is not always valued equally.

Here's the breakdown of the FICO score, as seen in MyFico:

1. Payment history

Payment history is the most influential factor of your credit score at 35 percent. It's also the easiest to control. Simply make your payments on time for all of your bills and you'll score highly in this area.

2. Amounts owed

Amounts owed clocks in at the second most important factor of your credit score at 30 percent.

This is also known as credit utilization or your credit-to-debt ratio. You can factor this ratio by adding up the amount due on all your revolving lines of credit. Then add up the amount of all of your credit limits and compare these two numbers.

For example, if you have two credit cards with a $500 limit each and no other revolving lines of credit, then you have a total limit of $1,000. If you owe $50 on each credit card, then you have a $100 balance in total. This equals out to a 10 percent credit utilization ratio.

To score highly in this category, keep your ratio at 30 percent or below.

Note: you might stumble on a "fact" stating that you need to carry a balance over from month to month to have a good credit score. This is simply not true.

Since a lower credit utilization ratio equals a higher score, a zero balance is the best thing you can have. Why? Because it will give you a zero percent credit utilization.

Lenders want to see you using your credit cards, but that doesn't mean you have to carry a balance and pay interest on that to get a good score. So if you pay your balance off every month, you'll stay out of credit card debt and improve your credit score at the same time.

3. Length of credit history

This next factor of your credit score is worth 15 percent and will improve as time goes on, as long as you don't cancel your credit accounts.

That's because this factor is length of credit history. Therefore, keeping your accounts open demonstrates you can maintain a good length of credit history.

Credit card issuers do sometimes close a credit card account due to lack of use. So you may need to periodically use old cards for small purchases and pay them off before the interest hits. That way, you can keep your accounts open and contribute to this portion of your credit score.

4. Credit mix

Credit mix refers to the types of credit you have, such as lines of credit and installment loans. This mix is worth ten percent of your score.

Ultimately, you'll score better if you have more than one type of credit. But it's not worth enough of your score to take a loan out that you don't need.

On the flip side, if you've been struggling with student loans and have a credit card, then your student loans can do something good for you. They'll contribute to your credit mix.

5. New credit

Finally, there's new credit, also worth 10 percent of your credit score.

This factor, though not worth a ton, can cause quite a bit of confusion for consumers. That's because many fear that having too many inquiries on their credit score will hurt this factor.

Here's the easy way to remember the rules on this one. If you're shopping around for new credit, do it quickly. And always apply for the same amount.

For example, if lenders see that you've applied for three home loans for $250,000 within two weeks, it will be clear to them that you're rate shopping.

But if you apply for a home loan for $250,000, a credit card, and an installment loan of $10,000, then it could look like you're overextended. And if you're overextended, you might be a risk.

Therefore, just shop for what you need and don't stretch out the new credit applying process days for more than 45 day. That way, you won't take a hit on this portion of your credit score.

What types of credit scores are there?

As mentioned above, there are many credit scores out there. But there are two major types you'll want to focus on, FICO and VantageScore.

There are multiple models of each, and lenders may use different models based on the product they're financing (i.e. mortgages versus auto loans).

Because of this, everyone has many credit scores. But if you follow the range your score falls into, then you're in good shape.

FICO credit score ranges

FICO has five credit score ranges as described by Experian:

300-579 "Very Poor"

580-669 "Fair"

670-739 "Good"

740-799 "Very Good"

800-850 "Exceptional"

VantageScore credit score ranges

VantageScore has five credit score ranges as described by Experian:

300-549 "Very Poor"

550-649 "Poor"

650-699 "Fair"

700-749 "Good"

750-850 "Excellent"

What the credit score ranges mean to you

These range descriptions are pretty self-explanatory. In short, the higher your score, the easier it will be to obtain new credit.

But, borrowing money isn't the only thing your credit score can affect. It can also affect your future employment opportunities and approval for things like an apartment lease or insurance.

Whether or not you want to finance purchases, you need to be aware of your credit score. Work to get it as high as possible so that it never stands in your way.

How to improve your credit score

There are a few different things you can do to get your credit score as high as possible, but they'll depend on your current range.

If you're new to credit

Looking to establish credit for the first time? If you take the following steps, you should see an uptick in your score in about six months to a year:
Get a credit card.
It's usually not difficult to get a credit card for the first time, though the credit limit will probably be low. However, if you're new to the U.S. or have trouble getting a credit card, you can opt for a secured credit card instead.
Get a secured credit card if you can't get a regular credit card.
A secured credit card is one in which you put down a down payment. This acts as a security deposit that you get back if you close the account or are upgraded to a traditional credit card - so long as your balance is paid off.

Many companies who offer secured credit cards regular review accounts to see if they might be eligible for an upgrade. That makes this is a great option to help you establish credit.
Make all of your payments on time.
Why do you need credit to build credit? Because it's the best way to show lenders that you can handle credit responsibly.

And the best way to do that is to make your payments on time every month and pay your balances as soon as you can so you can also avoid going into debt.
Try alternative credit reporting.
You can also look into alternative credit-building tools like RentalKharma. They verify that you have made your rental payments on-time, then report it to TransUnion for inclusion on your credit report.

If you're trying to improve bad credit

If you want to improve your credit score and avoid having it fall into one of the lower ranges, there are a few steps you can take.

Pay off delinquent bills or accounts: accounts that have gone to collections stay on your credit for years. That's why you'll want to take care of them as soon as you're able.

Negotiate a payment plan with your creditors: if you're unable to pay off delinquent accounts, reach out to your creditors and explain your situation.

Get a secured credit card to rebuild your credit: as stated above, a secured credit card will help demonstrate you can responsibly handle credit.

Make sure there are no errors on your credit report: if there are any errors, learn how to dispute credit report errors ASAP so you can get them off your report.

If you want to improve or maintain good credit

Let's say your credit score isn't in bad shape but you want to increase it. Here are some tips to help:

Check your credit report annually: and dispute any errors that you come across quickly.

Apply for a credit limit increase: doing so will decrease your credit utilization. Which, remember, makes up 30 percent of your score.

Pay all your bills in full and on time: this will continue to demonstrate that you can handle credit responsible, and help you avoid acquiring debt in the process.

Pay off your debts: by keeping a low-to-zero balance on your debts you maintain a great credit history for lenders to view.

Some may worry that increasing your credit limits is counterintuitive to paying off debt.

Just remember that if you increase your credit limit, you shouldn't increase your balance. Otherwise, you've done nothing to improve your credit utilization or your credit score.

Don't go into debt to improve credit score

There are a lot of myths on how to improve credit scores, some of which can be disastrous to your finances. All you have to remember is that whatever keeps you financially sound will help you improve your credit.

In other words, if you want to appear to be a responsible borrower, use credit. But, pay it off every month so you don't go into debt.

And if that's not possible (which it may not be for a mortgage, auto loan, or student loan), then pay it off as soon as you can.

Most importantly, always pay your bills on time. And don't co-sign on accounts you can't afford to pay off should the borrower default.

In the end, if any credit scoring advice coming your way promises a quick fix or seems too good to be true, it probably is.

Interested in a personal loan?

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¹ Includes AutoPay discount. .

1. Terms and Conditions Apply : SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi's underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Finance Lender Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)

2. Fixed rates from Personal Loans : 5.49% APR to 14.24% APR (with AutoPay). Variable rates from 4.98% APR to 11.44% APR (with AutoPay). SoFi rate ranges are current as of December 21, 2017 and are subject to change without notice. Not all rates and amounts available in all states. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 4.98% APR assumes current 1-month LIBOR rate of 1.34% plus 3.89% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.

² .

1. Personal Loan Rate Disclosure : Fixed interest rates range from 5.99% - 16.24% (5.99% - 16.24% APR) based on applicable terms and presence of a co-applicant. Lowest rates shown are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.

2. Loyalty Discount : The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.

3. Automatic Payment Discount : Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.

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How Do Credit Scores Work? Here's Your Ultimate Guide | Student Loan Hero

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You always hear how important it is to know your credit score and maintain a good one. But with so much information out there, you're probably wondering "how do credit scores work?" and don't know where to start.