Most families do not pay for their homes, cars, or other important acquisitions from their current income and savings. They spread the payments out over a period of time to make it a manageable undertaking. A college education is often financed this way too. An illustration of options one family has in paying for a year of college follows.

Family owes $10,000 after aid is deducted:

Option 1:  Pay bill in full each semester

• Family pays $5,000 in August for fall semester.
• Family pays the other $5,000 in December for the spring semester.
• No finance charges or interest have been incurred.

Option 2:  Four payments per year

• Family pays half of fall semester charges in August: $2,500.
• Balance remaining is $2,500.
• One percent interest is assessed on the unpaid balance:
  $2,500 x 1% = $25.
• Family pays balance of $2,525 ($2,500 + $25) in September.
• Same procedure is repeated in December and January for the spring semester.

Option 3:  UE's Monthly Payment Plan

• Family uses UE's 12-month, interest-free payment plan.
• $833 is paid per month starting in May and ending in April.
• A one-time $60-$90 payment plan fee is charged to participate.
• Detailed information about our payment plan can be obtained from the Office of Student Accounts.

Option 4:  Federal Parent Loan for Undergraduate Students (PLUS Loan)

• Family borrows the entire $10,000 on the Federal PLUS Loan.
• Monthly payments are about $126 a month.
• Interest rate is fixed at 8.5 percent.

Option 5:  Combination of payment options 

• Family puts $5,000 on UE's payment plan at $500 per month and borrows the other $5,000 on the Federal PLUS Loan with a monthly payment of about $63 a month.
• Total monthly outlay is $560, but much of it is not accruing interest.

OTHER LOAN OPTIONS

• The Federal Parent Loan for Undergraduate Students (PLUS) allows credit-worthy parents to borrow (irrespective of financial strength) up to the cost of education minus student financial aid at low interest rates and long pay-back periods. Repayment typically begins in February of the academic year. The interest rate is currently fixed at 8.5 percent. Applications are available through UE. Up to three percent in origination fees may  be deducted by the bank each semester before funds are disbursed. Families must reapply each year for this loan.

• Many reputable companies have special programs for families of college students. Options on these loans vary according to who can borrow, how much may be borrowed, repayment terms, interest rates, other fees, and monthly payments. In many cases, the student can be the borrower of these private deferred payment loans, but a co-signer is required. The following are some examples of these loans:
• Citibank
  CitiAssist Loan www.studentloan.com
  800-967-2400
• Fifth Third
  Sallie Mae Signature Loan www.53educationlending.com/signature
  800-222-7192



• Home equity loans provide an excellent opportunity to use equity in primary residences to finance college costs. Such programs offer competitive rates and tax benefits not available using other options.

• Variable life insurance policies can often be accessed by borrowing against the accumulated cash value of the policy.