SOURCE: NextStudent

January 19, 2007 15:06 ET

NextStudent Explains the Benefits of the Parent Loan for Undergraduate Students

PHOENIX, AZ -- (MARKET WIRE) -- January 19, 2007 --According to NextStudent, the Phoenix-based premier education funding company, Parent Loans for Undergraduate Students are a smart financial strategy that help parents ensure they can meet the costs of their child's college education at a low interest rate and on excellent terms. This student loan is also known as the PLUS or parent PLUS loan.

College tuition is on the rise and parents are often left to help their child carry the burden of college expenses. Rather than scrambling just to make ends meet, PLUS student loans offer a federal alternative to credit cards and private student loans. Nowadays it seems as if the "best defense" a parent can arm their child with when it comes to entering the real world of bills, mortgages and even college debt, is a college diploma, but that costs money.

PLUS loans offer generous borrowing limits. Parents can borrow up to the entire cost of their child's education (less any federal aid received), covering the cost of books, supplies, new computers and even software. Because this type of student loan is not need-based, just about everyone qualifies for a PLUS loan. Most applicants qualify within minutes when they apply online with NextStudent's simple application process with E-Signature. Additionally, PLUS loans are available year round -- even if the parent has already paid tuition and education expenses. However, the student must have filed a FAFSA in order for the parent to be eligible for a PLUS loan.

These loans are federally funded student loans, so the interest rates are set by the government. To participate in the Federal PLUS Loan Program, private lenders must be approved by the government. Therefore, PLUS loans from different lenders are distinguished by the benefit packages those lenders offer to prospective applicants -- in this case to parents.

NextStudent offers an aggressive incentive package that helps reduce college debt even further. Parents will receive the following benefits by funding their PLUS loan through NextStudent: a 3 percent cash rebate on the remaining principal balance after the first 12 months of consecutive on-time payments, a 2 percent interest reduction after the first 48 months of consecutive on-time payments and a .25 percent interest rate reduction if the parent chooses to use Auto-Debit.

NextStudent also offers borrowers a second opportunity to qualify if they receive an initial denial due to unresolved credit issues. NextStudent has been able to qualify 87% of its applicants, in large part because of NextStudent's PLUS Credit Resolution Team's ability to resolve credit issues for borrowers.

PLUS Loans are a smart financial strategy for parents looking for ways to pay for their child's education without breaking the bank, or placing their child in considerable debt. When it comes to repayment, PLUS loans also offer financial flexibility. There are several repayment options including deferred repayment while the student is enrolled in school at least half-time, and federal student loan consolidation eligibility.

About NextStudent

NextStudent, federal lender code 834051, is dedicated to helping students and their families find affordable ways to pay for college. NextStudent offers one-on-one education finance counseling and has a portfolio of highly competitive education finance products and services, including a free online scholarship search engine, federally guaranteed parent and student loans, private student loans, both federal and private student loan consolidation programs, and college savings plans.

The NextStudent Scholarship Search Engine, one of the nation's oldest and largest scholarship search engines, is updated daily, available free of charge, completely private -- and represents 2.4 million scholarships worth $3.4 billion.

For more information about NextStudent and its student loan programs, please visit the company's Web site at http://www.nextstudent.com/.

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