PHEAA launches low-cost PA Forward Student Loan Program
Applications are available for the Commonwealth’s new PA Forward Student Loan Program, currently offering a suite of borrower-friendly loans for undergraduate and graduate students and parent borrowers. A PA Forward Refinance Loan will be offered later this year to combine all of a borrower’s Federal and private loans into one convenient monthly payment, which could help lower their monthly payment and/or reduce the amount they pay over the life of the loan.
“The PA Forward Loan Program will make borrowing more affordable in Pennsylvania — but students must first understand that loans should be used to pay for college only when it’s absolutely necessary,” said representative Mike Peifer, PHEAA board chairman. “We created this new low-cost loan program to provide relief to students and families who might still need financing assistance — even after exhausting their eligibility for grants, scholarships and low-cost federal loans.”
With first year borrowing limits on federal loans as low as $5,500 and the annual average cost to attend college in Pennsylvania at $43,866, many students experience difficulty affording the full cost of attendance even after taking advantage of available grants, scholarships, campus-based aid and federal loans.
If family savings are not sufficient, students often rely on private student loans. This is one reason why the average student loan debt for a Pennsylvania undergraduate student is nearly $37,000.
“While today’s easy access to expensive private loans helps fill a funding gap for many students, it’s also one of the reasons that millions of borrowers are struggling to manage crushing levels of loan debt for decades after graduation,” said Senator Wayne Fontana, PHEAA board vice chairman.
PHEAA will serve as the lender and loan servicer for the program, with tax-exempt allocation provided by the Pennsylvania Department of Community and Economic Development (DCED). Leveraging the combined resources of the Commonwealth allows PHEAA to provide the program at low rates with better borrower benefits as compared to most commercial private loan programs.
PA Forward student loan borrowers can borrow up to the total cost of attendance with competitively low interest rates. Additional benefits include no application or origination fees, and flexible repayment options and terms.
To help students make informed choices about their higher education funding plan, especially when considering a student loan, PHEAA created MySmartBorrowing.org. This free resource helps users understand how different career, school, and financial decisions made during the college-planning process can influence their total cost of an education and their ability to repay any student loans after graduation.
To learn more about PA Forward loans and to apply online, visit PHEAA.org/PA-Forward.