Paying for College After Scholarships

Webinar Transcription

2026-06-10-Paying for College After Scholarships

Anna: [00:00:00] Hello, everyone. Good evening, or afternoon, or morning, whatever time it is from wherever in the world you’re joining us. We are so happy you’re here for our webinar with our partner Juno, “Paying for College After Scholarships.” My name is Anna Vande Velde, and I’ll be your moderator today. I’m a senior advisor at CollegeAdvisor, where for the past almost five years I have worked with students one-on-one in advising sessions and have been a co-captain on our essay review team.

Anna: To orient everyone with the webinar timing, we’ll start off with a presentation, then answer your questions in a live Q&A. On the sidebar, you can download the slides, and you can start submitting questions in the Q&A tab anytime. We’ll get to as many of them as we can [00:01:00] at the end. Before we get into the presentation, first I need to introduce your, your presenter tonight, Eddy.

Anna: Eddy, could you please share a bit about your background?

Eddy: Sure. Thank you for having me, and it’s a pleasure to be here with all of you this, uh, this evening, this afternoon, maybe morning, depending on where you’re tuning in from as well. I know there’s, uh, a very large reach through CollegeAdvisor, so it’s my pleasure to be here with you all.

Eddy: Um, I’m currently on the Juno undergraduate, uh, partnerships team. Uh, I previously served in different roles, uh, within the last decade across, uh, across educational institutions. I was an admission officer at Williams College, uh, also at Yale University, and then I was a college counselor at a, uh, private boarding school in New England as well.

Eddy: So I’ve seen a lot of the different parts of the college application. Love working with, uh, with the team here at CollegeAdvisor to meet all of you, as I know you’re, you’re all very [00:02:00] curious, ask a lot of really great questions. So don’t be shy in using the Q&A feature here. Um, and we can, uh, we can jump into all of your questions that come through

Anna: Absolutely.

Anna: Thanks, Eddy. Before you get into your presentation, thought it might be helpful for us to get a sense of who’s joining us. So I’m gonna open this poll. Please let us know which of those options best describes you. And while we wait for those results to come in, Eddy, I’m sorry if this is jumping ahead, but I wondered if I could ask what inspired you to join Juno?

Eddy: Oh, sure. Absolutely. So I think for me, I actually… Uh, I, I didn’t mention this, but it was on the screen. I’m actually pursuing an MBA degree as well. And when I applied for my undergraduate institution, I had a lot of support. Uh, I had a really great college counselor through a college ads organization I was a part of.

Eddy: Um, and coming into that process, it was, uh, just a [00:03:00] lot of significant help that, that I received ’cause I didn’t know anything about the college process. Um, and then from there, as I then took this next step to graduate school, uh, it was a very different process entirely as well. I also didn’t know anything about it.

Eddy: I was the first in my family to go to college, undergrad, first to go to business school. And so as I was navigating how to pay for this, uh, I actually heard about Juno, uh, from just, just by needing to take out loans for myself. So I’m not just a, uh, sort of… I don’t just work at Juno. I actually use Juno.

Eddy: That’s how I heard about the organization. Uh, I used Juno for my, for my school loans and ended up having- finding a role on the team as well, in part. So I practice what I preach in everything that I share here. Uh, I’m still currently in school. I actually still use Juno for my loans. So I’ve been grateful ’cause I actually saved a lot, uh, in terms of the interest rate that I got and the o- on the overall, [00:04:00] um, life of my loan, um, based on, based on that.

Eddy: So that’s how I got into the organization. I saved a lot of money. I like saving money. I like saving other people money. Uh, I think it’s a win-win all around. Um, and so for those, whether it’s undergraduate programs, uh, which I’ll spend most of our time today talking about, certainly any graduate programs ’cause I know a lot of students who are highly motivated.

Eddy: They’re not just thinking sort of one step, but they’re thinking two, three steps in the future and how they might m- be able to make all of their educational pursuits a reality. Um, there’s a lot of different, uh, options to help pay for college or finance it. Um, but the reality is for many, many students, loans do become part of that equation.

Eddy: Um, and so if you do need to borrow, sort of Juno’s whole, whole purpose and mission is, uh, if and only if you need to borrow, then to do so at rates that are more competitive in the marketplace. That’s how I got introduced to [00:05:00] it. Um, so I started as a user myself, uh, and then expanded into this role here.

Anna: Thanks so much, Eddy. And I know you’re gonna get it into later how folks might get connected to Juno if they’re interested. Um, but for now, our poll results are in. About 50% of folks are parents of a high school student, about 35% are parents of a college student, and then we have a pretty even split between college students, high school students of each year, um, a- and other.

Anna: So we are so happy you are all here. Thanks for sharing what best describes you. Um, it helps Eddy as he works through his presentation. I’m gonna close the poll, and I forgot to mention at the top, this is being recorded, and it will be emailed to everyone who registered. Um, and I did say this, the slides are available for download in the handouts tab.

Anna: Um, I think that’s all the housekeeping. So Eddy, I’m gonna turn it over to you for your presentation. [00:06:00]

Eddy: Awesome. Thank you So, uh, I actually just see a question here right off the bat that I, I wanted to speak to, uh, from Samantha. Congratulations, your daughter is accepted. I’ll keep my eye on the Q&A. We’ll reserve more of it towards the end, but I just wanted to talk about this really quickly here.

Eddy: Um, congrats on the, the… Your daughter’s college acceptance. Um, got a, a part of it as a scholarship, which is great to see. Um, does not want loans. That’s completely understandable. So as I just mentioned, like, loans are the last option. If you can maximize grants and scholarships, absolutely do that. Uh, either from the university itself, if there’s additional opportunities for, uh, institutional aid, any external scholarships, uh, outside scholarships that she can apply for, absolutely go that route.

Eddy: Uh, that is first and foremost what we encourage. And then if and only if you do have any remaining amount after that point, [00:07:00] uh, after you’ve, you’ve, you’ve used your savings, um, then from there, for example, that’s where you can consider, uh, o- other additional ways to help pay for it. I’ll speak more about this, but again, I hear that concern off the bat.

Eddy: Um, when I was a school counselor myself, this is a conversation that we rarely had. Um, but oftentimes as I’m now in my role now, uh, I do presentations for high schools, for couns- high school counselors as well as parents and students. Um, this, the con- many don’t, many don’t address the realities of kind of where we are in, in today’s landscape.

Eddy: College has gotten more expensive. That’s a reality of where we are in twenty twenty-six. Um, certainly there are families that can pay the full cost, others that need additional support, others that get tremendous scholarships. Those are all good things, right? If you can get scholarships. But then again, what happens if there is a [00:08:00] gap?

Eddy: Then how are you gonna help cover that gap? That’s really where, um, where we see this being more so a conversation of necessity and at least getting some information about it rather than just ignoring the conversation entirely. It’s a really, really good point that you brought up. So we do wanna talk about the cost of college, um, federal loans as well.

Eddy: There’s some b- pretty big, uh, changes to federal loan policy if you haven’t yet heard about it, and we’ll cover that. Um, and then how that, uh, the federal changes impact available options for families. Uh, we’ll talk about how private loans work as well. It is now, as a result of the federal changes, uh, a necessity for families to know about.

Eddy: And then a little bit about Juno’s work, how we help families find the lowest rate. And then of course, please ask your questions all throughout. Now, I’ll just mention this quickly. Basically, the, the model that, uh, the model that we have implemented here, Juno started back in twenty eighteen with a [00:09:00] very simple question.

Eddy: You know, can we get better rates if we negotiate as a group than if we were to go individually? And so two Harvard Business School students started Juno back in twenty eighteen with that simple experiment. It ended up working. They actually got, got a lender to give them a better rate than, uh, because of that collective bargaining.

Eddy: They actually pooled together about seven hundred business school students from, from around the country, uh, and they collectively bargained for a better rate. So that’s really what it was, and then from there, sort of Juno has grown, uh, ever since. Um, this past year, we actually negotiated on behalf of a little over thirty thousand families who are exploring options between undergraduate and, and graduate options.

Eddy: So as a result of that size, we all come together. Uh, and again, I mentioned I, I’m one of those members myself. Uh, so we all come together, uh, as a collective group, and then lenders basically, uh, bid. We run an auction essentially where they [00:10:00] bid on the ability to work with the entire Juno family So I’m happy to answer more specific questions about this, and I, I’ll talk a little bit more about it towards the end.

Eddy: Now, if you’ve tuned into any of our presentations before, uh, you may have seen this timeline. I know we have a, a range of different folks who are tuning in from, uh, throughout high school careers, uh, even in- into college. You may be familiar with the FAFSA already, the Free Application for, for Federal Student Aid.

Eddy: Uh, just remember the FAFSA is free to submit, uh, and so you never pay for it. Those open up October 1st, so especially for the younger students or those who are not seniors or in college. It’s– Actually, this is still relevant for everyone because you submit, you submit financial documentation every single year.

Eddy: Um, so you need to submit this information. Some schools do require the CSS profile. It’s a smaller subset of schools that, that require that. It’s another financial aid application. And then from there, uh, you get your [00:11:00] Student Aid Index number. The Student Aid Index number determines, um… It’s a number that is essentially represents, uh, an amount that your family, uh, can afford, and that number is used to ultimately determine your financial aid package.

Eddy: Many of the school students then apply to college, uh, whether it’s early decision in November. Most commonly, students are applying regular decision in by January timelines, and then you receive your financial aid offer. It determines how much the cost of the school is, and then, uh, from there, any grants and scholarships that are received.

Eddy: Now, really important to note is you can appeal your financial aid. So many families don’t know this. Uh, one of our most popular webinars, and we hosted this, uh, a few months ago as well, uh, with, uh, with college advisor here, is appealing financial aid. What are some of the reasons you can? What are the documents that you need to collect in order to successfully [00:12:00] submit an appeal award?

Eddy: Uh, we created a tool as well. Um, I’m happy to link it if you wanna play around with it. A financial aid appeal generator tool. Uh, it’s free to use. It’s just one of the resources that JUNO’s created.

Eddy: And then ultimately, then you’ll decide which school to attend, research how you might then pay for it, which is really where we are now in the summertime before that tuition, uh, due date is, uh, needs to be submitted. Now, we host, again, a lot of different webinars on these various topics from FAFSA, the Student Aid Index, appealing financial aid, but what, what we’re gonna talk about and focus today is researching the loan process and how to pay for college.

Eddy: So generally, you can pay for college through various different sources, and this gets to the, uh, the question that was asked, uh, earlier here. Uh, and so we do wanna maximize grants and scholarships always. Uh, you have to know what the cost is, [00:13:00] then get the free money where it’s possible, and then anything else after that point, you may need to borrow.

Eddy: And if, and only if, that’s the situation, then y- at least borrow avoiding any of the high rates, uh, if you do need to explore that as an option Now, I wanted to illustrate this with an example, uh, so we can think about it in concrete terms here with UCLA’s cost of attendance. Now, this is UCLA’s in-state cost of attendance that we’ll focus on.

Eddy: Um, so you see how all these different factors add up from tuition and fees, um, housing and food, or also called, um, um, your, uh, your meals, uh, um, your, um, housing and, yeah, housing and meals or meal package. Uh, health insurance as well can sometimes be added in. Those generally are billed expenses, so they’re billed directly to the university.

Eddy: And then there may be a series of unbilled expenses as well. Things like [00:14:00] personal expenses, which are just an estimate that the college has, uh, included for various different costs that a student will have over the course of the year. So that can be, you know, transportation to campus, for example. That can be laundry services.

Eddy: It can be going out to dinner with friends. It can be buying a s- ticket to, you know, those, uh, various different sporting events. All of those factor into those personal expenses, as well as books. And you add all those up, and you get the total cost of attendance for one year at UCLA in-state is about forty-five thousand dollars.

Eddy: Now, this is the number that you’ll see on the financial aid website. Uh, for the seniors who are here or the current college students, you will see this number on the financial aid offer that is sent to you by the university, uh, total cost of attendance and how the breakdown is based on these specific numbers for billed and unbilled expenses.

Eddy: Now, again, this is one year, so to get the cost of f- four years of [00:15:00] college, you can multiply this by four to get a rough estimate. Um, just know that usually tuition does increase, uh, every year about, by about two to three percent, so the cost might increase slightly, uh, every single subsequent year. Now, one important note here is that you can waive health insurance if the student is still able to be on a parent’s plan, and that covers the location that the student is going to college in.

Eddy: So this doesn’t necessarily have to be an expense. Um, it can be waived if the student has coverage Now, as we think about how to c- meet the, the total cost of attendance through various different sources of funding. Now, as we think about federal, institutional, and state sources, right now, where we are in the process in terms of June, many of these are, uh, s- I should say some of these funds may have been [00:16:00] exhausted by this point.

Eddy: Uh, we always encourage families to apply for financial aid as early as possible, especially, uh, both federal and state sources. Uh, in some cases, it is possible for, um, for, uh, s- uh, institutional sources to also run, uh, funds to run low. But if you’re th- if you’ve applied for federal funding, uh, for example, you submitted the FAFSA, you may have seen Federal Pell Grants of up to $7,395.

Eddy: That is s- a source of funding that is available. Additional funds include the FSEOG grant, which is a Federal Supplemental Educational Opportunity Grant. This is an additional fund, uh, source of funds that, uh, y- the federal government sends a pool of money to the university to distribute and allocate to the students who have the highest demonstrated financial need.

Eddy: So again, this will be based on the results of the FAFSA. And then from there, you might receive, uh, [00:17:00] any, any award from a- about $100 to up to $4,000 based on what the school determines your financial need is. There are also jobs classified as Federal Work Study. And so some of you who are in college may be familiar with this, um, or not, depending on your financial aid package.

Eddy: But you can s- the Federal Work Study program is designated specifically for students based on the results of their FAFSA as well. And the, the on-campus job that is designated within this category is partially subsidized by the federal government and also partially paid by the university. And so that’s why it’s reserved for a specific population, um, because the federal government is, is paying the student, uh, the student’s, uh, salary or, uh, or earnings, uh, in part.

Eddy: That’s usually a modest work expectation. It’s not technically a grant, uh, ’cause the student does have to work for it. But the note that I wanted to mention here is that there are also other [00:18:00] work-study opportunities that a student can find that is not the f- designated federal work-study program. Many universities will have campus jobs where students are able to work in exchange for some kind of payment.

Eddy: It doesn’t have to be the federal work study. You may not qualify for federal work study, but you can still get, um, still get a campus job in that regard. And additionally to that, there are also many off-campus jobs in the local area that students might be able to pursue if you prefer that as an option.

Eddy: Now, state grants are s- very subject to, um, uh, to running out. State grants are reserved for in-state applicants, and at this point it is quite late in the process. Um, so I wouldn’t have a lot of confidence if any seniors in the, in the audience here are trying to secure additional grant funding. It’s not to say that it’s not possible, [00:19:00] but you absolutely wanna focus this on a– focus on applying for any state grants as early as possible.

Eddy: And as I mentioned, the school itself has financial aid available. This is oftentimes a great way, once you submitted your financial aid application information, for the school to respond and be able to provide additional aid. Now, note here that schools can provide both need-based financial aid, which is de- uh, determined by the results of the FAFSA.

Eddy: And in addition to that, a school can provide you a merit scholarship if they offer merit aid. And in that case, that’s an opportunity for them to recognize that they really want you as a student on their campus. Uh, you bring something, uh, to the table that is really important for them, and they wanna have you join their community.

Eddy: And so they may give you additional aid, uh, in order to help, uh, attract you to that school Those, there’s both [00:20:00] need-based and merit-based scholarships that are possible. Now, you do have to fill out this information every single year. Uh, and so d- based on the results of your FAFSA, um, the lower your Student Aid Index number is, the more grants that you receive.

Eddy: And the higher your Student Aid Index is, the less, uh, grant money you are, you may be able to receive. So in this example, we’re just gonna assume that a student receives a $5,000 sc- uh, scholarship from UCLA so that we can then, um, consider how the other pieces fit together. If we subtract that from the total cost of attendance, we have the, this amount that’s left to pay, a little over $40,000.

Eddy: Now, this is considered the total need that a student has, a student and a family has. So cost of attendance minus any s- grants and scholarships is your total need, which is also the equivalent of your borrowing limit. So a university will not let you borrow [00:21:00] beyond this amount. So after scholarships are received, um, you subtract that from cost of attendance, and you cannot borrow if you need to.

Eddy: You cannot borrow more than this amount. Now, that’s important to note because, uh, I’ve t- spoken with some families, for example, where their schools offer scholarships in the summertime, so they actually don’t know yet. It hasn’t been determined how much scholarships or grants that they’ll receive. That’s okay.

Eddy: Let’s say in a month time, if you are a current senior… Uh, excuse me, if you just… A, a rising college freshman, you may have just graduated, uh, from your senior year of high school. If you hear suddenly that your school in July offers you a $20,000 scholarship, that’s amazing. We’re gonna celebrate, and then you would subtract that $20,000 from the cost of attendance.

Eddy: So let’s say it’s forty-five thousand, you subtract twenty thousand. Your new amount left to pay and your new borrowing limit might not be, uh, five thousand, [00:22:00] but it’s… We, we add that ex- extra grant, um, that was offered and, and now in total it’s $20,000. So your borrowing limit then is gonna be $20,000 less than the original cost of attendance, which is great news for you.

Eddy: Um, so the amount left to pay would only be $25,000 at that point. Now, that’s an important note ’cause there are sometimes institutional scholarships that come in late, any external scholarships that might come in, maybe you get an additional $1,000 scholarship, an additional $5,000 scholarship at some point throughout the summer.

Eddy: That will further reduce this, uh, borrowing limit. From here, once you have that borrowing limit, then this next step is any savings that the family has available to use. So it can be in a 529 plan, it can be in a high yield savings account, or any other accounts that you’ve been… the family has been using to help, uh, save for college costs.

Eddy: In this example, I’m gonna assume, uh, [00:23:00] $10,000 that the family has available to help contribute to college. From there, one quick note that I wanted to mention. If you have any funds that are available in any accounts, any sa- any savings accounts, utilizing those funds early on can be helpful. You don’t have to.

Eddy: You can certainly save portions of it for future years, just in case, uh, you know, you never know there may be, um, if particularly if you have unstable income, that could be a direction that you consider. But if you do utilize any of the funds that you do have saved available, for next year, because you do not have– because you have to apply for financial aid every single year, the subsequent year you would have a lower amount to report on your financial aid applications.

Eddy: And so the less in assets that you have to report, uh, that could impact your financial [00:24:00] aid offer. Now, I wanna be clear here that it, it may not have as dramatic of an impact as you may hope, um, but just know that any assets that you do use, the reduction in those assets, or if you use your entire sa- you know, uh, savings, maybe t- maybe, uh, $10,000 was the entire 529 plan.

Eddy: If you deplete that, then you no longer have that asset to report in the subsequent years. And so your total asset amount would be lower when you’re applying for financial aid the next year. This would also, uh, importantly defer any loans that you might have to take out, and so any interest that could potentially accrue would not happen because you don’t need to at that point.

Eddy: Interest does begin accruing on loans the moment you, the moment is, it is dispersed to the university, so just know that. So if you, if you can push out your borrowing, that can be helpful because then you’re not paying as much in interest. [00:25:00] So after that point, you use your savings, and we have a new amount that is needed to borrow.

Eddy: I’m gonna walk through a lot of different, um, pathways here and options, both federal options for the student, federal options for parents, and then also any private options as well.

Eddy: Now, for undergraduate families specifically, um, of these three options, we always encourage utilizing the federal direct loans first. So federal direct loans, just quickly, I’ll go into, into detail on each one of these. But federal direct loans have lower fixed rates. Um, they have great, uh, repayment benefits.

Eddy: Um, the downside is that there’s low borrowing caps to them. Now, for Parent PLUS loans, these are loans that the parents take out in their name, and they’re solely responsible. They do have high origination [00:26:00] fees, unfortunately. Uh, it’s the same rate across the board for every single person, regardless of your credit score.

Eddy: As long as you qualify, everyone gets the same rate. Uh, and then there are now limits in place, uh, which we’ll get to, uh, to talk about. You can now, starting July 1 of 2026, so in less than a month now, there’s going to be a cap in place of $20,000, $20,000 per year. On the private side, these come from various different sources, banks or credit unions, any other lenders that are out there.

Eddy: Um, they usually don’t have origination fees, um, but the downside is that there, there are usually very few protections associated with them. Uh, with these loans, you can borrow up to the cost of attendance, but they are based primarily on an individual family’s financial health, so your credit score, for example, your income, your debt to income ratio.

Eddy: Before we talk specifics about each of those, I wanted to highlight just a few important questions to [00:27:00] be thinking about and factors on the financial and the non-financial pieces. So on the financial side, is there an origination fee? Is there a cost just to take out the loan in the first place? What is the interest rate?

Eddy: Uh, many families very much focus on this and for good reason, right? This is gonna determine the overall cost of your loan as well, the interest rate and how much interest you might pay over the life of the loan. Are you looking at, uh, fixed rates or variable rates? What type of, um, loan are you, are you pursuing?

Eddy: And then do, are there any borrowing limits, borrowing caps? We’ll talk about that on the federal side. Now, what’s also important to know beyond just any financial metrics, can you qualify and how do you qualify for any particular loan? Whose name is the loan in? This is a common question that I get from a lot of parents as well.

Eddy: And then when do you start having to make payments, and what happens if there’s any kind of hardships or [00:28:00] financial difficulties? What do you do in those circumstances? So let’s dive in into the Federal Direct Loans, and we’ll talk about each of them. Uh, this is a fixed rate loan that undergraduate students can take out.

Eddy: It’s six point five two percent for the upcoming academic year, so the interest rate actually went up unfortunately about thirteen basis points, uh, which is point one three percent from last year to this year. It was six point three nine percent last year. This loan does have an origination fee of about one point o six percent.

Eddy: Just know about that. Uh, and there’s a… it’s capped at fifty-five hundred dollars for freshman year. Now, as long as the student is enrolled in college, they’ll qualify for this. There’s no credit check, there’s no, um, income requirements here. So the student is the one who’s borrowing this amount, and they’re responsible for it.

Eddy: The payment will begin six months after graduation, so that’s the grace period [00:29:00] and this does have hardship protections, which is one of the primary benefits of this type of loan and why we encourage considering this as the first step. Now, the interest rate is fairly competitive, I will say, given where the market is today.

Eddy: And so the other piece of that though is a student can, um, this loan does have, uh, protections for, um, both deferment and forbearance options. There are opportunities for public service loan forgiveness as well, uh, through this program. And so if a student is, uh, interested in public service as a career path, as long as you make consistent on time payments over ten years, you can have any remaining balance of your loan forgiven, uh, as long as you’ve been making those on time payments.

Eddy: So this is a really good first step, uh, if a student does need to borrow at all. Now, one note here is that depending on the results of your FAFSA, you may also qualify for a [00:30:00] subsidized loan of a maximum of 3,500 of this 5,500 can be subsidized. So what that means is that the federal government actually pays the interest while the student is enrolled in college and through the grace period, through the six months after graduation.

Eddy: So that’s best case scenario because interest does accrue when the loan is dispersed, which means it gets sent to the university and paid out, paid to the university. Uh, and so up to 3,500 of that can be subsidized where the federal government is paying the interest. Then the remaining 2,000 would be the student’s responsibility.

Eddy: Um, you don’t have to start making payments. Uh, if you don’t pay the interest, that will, uh, it will add up, and it gets added to the principal balance at the end of, uh, at the end of, um, the grace period. Just be aware of that Now, the $5,500 limit that I was describing is a limit for freshman year of [00:31:00] college for dependent students, which means, uh, a student is, does not meet any of the following criteria that you see on the right side of the screen here.

Eddy: Now, borrowing limits go up to $6,500 for sophomore year, and then $7,500 for junior and senior year. So it is, it’s not cumulative, so it’s, the limit is $5,500 for freshman year. If you don’t borrow that, it does not roll over to the next year, so you have to borrow the amount in the given year. But these are the borrowing limits.

Eddy: Now, if a student is independent, which I wanna make an important desig- distinction here, uh, because this is not any IRS definition of independence, not who you claim on your taxes. Um, there’s a very strict definition for the purpose of financial aid and the FAFSA in how independent student status is considered.

Eddy: So the student has to be at least 24 years of age. Uh, they, uh, they are married. If they’re married, they’re [00:32:00] considered independent. If they’re a graduate or professional school student, then they’re considered independent, as well as a veteran member of the armed forces, an orphan or ward of the court, an emancipated minor, or even, uh, homeless or at risk of being homeless.

Eddy: Now, that does require documentation, uh, and so a student does have to prove this independent student status. If a parent is interested in applying for the Parent PLUS Loan and they get denied, then a student can be eligible to borrow more, uh, than what the, um, than what is typical. So if a s- parent, uh, if a parent is not eligible for the Parent PLUS due to an adverse credit event, then a freshman year student can actually borrow 9,500 instead of 5,500.

Eddy: So just to emphasize this point, really the, the Federal Direct Loan is the [00:33:00] best starting point, first of all, and if you don’t need more than five thousand five hundred for that freshman year of college, then that’s the best bet. You can pretty much be done with, with your borrowing needs and use that to cover what your, what your costs are.

Eddy: If you need more than that, then this is where you can enter the conversation of exploring other options between Parent Plus and even private options. So to get into the details of the Parent Plus Loan now, the Parent Plus Loan has a higher fixed, uh, interest rate at nine point oh seven percent. So this is much higher than the Federal Direct Loan of six point five two percent.

Eddy: That’s why we encourage the Federal Direct Loan first in the student’s name. Um, this interest, uh, this loan, excuse me, has a higher interest rate as well as a, a generally high origination fee, as we mentioned earlier. This loan is only in the parent’s name, so the student is not legally [00:34:00] responsible for this.

Eddy: This is important to know because for some parents, that’s totally fine. For others, they actually… Pa- some parents may want, uh, students to, to have part of that responsibility, and so there’s, this, this is not, there’s no right or wrong answer here. It’s just a matter of, uh, uh, what’s, what makes the most sense for the overall family.

Eddy: The consideration here is the p- the Parent Plus now has a borrowing capacity of twenty thousand dollars per year per student, and so from that, you may actually need additional loans beyond that in some cases. For some, you may not, and if you only need less than twenty thousand dollars per year, you could be covered through the Parent Plus program.

Eddy: Payments for this do begin sixty days after the loan gets sent to the university, but just know that you can request deferment un- of six months after graduation. So you can get that grace period of [00:35:00] six months, but it does have to be requested. Um, so if that’s important to you to not have to make payments right away, which is very common for a lot of families to prefer that as an option, just know that you can do that.

Eddy: So explore this as an opportunity, uh, after the student used the, the direct loan first. Um, but just know, again, it’s something that the parent res- parent is responsible for. Everyone gets the same rate. As long as you qualify, everyone gets the same rate. Uh, you just cannot have an adverse credit event on your history, so no, um, no, uh, bankrupt- recent bankruptcies, for example, no tax liens.

Eddy: Um, as long as you don’t have any of those on your profile, then, uh, it’s generally many will qualify for it.

Eddy: A few questions that we get as well that I just wanted to address here. Um, parents of undergraduate students who are enrolled at least half-time are eligible to [00:36:00] take out this loan, and it is only a loan that is in the parent’s name again. Just wanna emphasize that. You can click the link here when, uh, if you have the slides open, uh, or download it later.

Eddy: Uh, it takes you to studentaid.gov, and that’s the website where you can submit information to sub- uh, to apply for the Parent PLUS Loan. And as I mentioned, it is possible to be denied. Not everybody qualifies for it. But if you are denied, there also is one step that you can take, which is to get an endorser.

Eddy: An endorser is essentially a cosigner for the Parent PLUS Loan. And so you– the parent would then essentially be getting a cosigner for this loan, an endorser for this loan, who would secure it in the case that a parent is not able to pay Now, I highlighted the, uh, the changes here. This is where I wanna spend a moment just talking about the distinction, ’cause we have current college students, and we also have, um, incoming college [00:37:00] students and younger high school students as well.

Eddy: So I mentioned this annual cap of $20,000. For any high school seniors, or you may have just graduated, so I’ll just say for anyone who is starting college in fall of 2026, so in a few months now, you… An-anyone who’s starting in fall 202-26 and younger, so all younger class years, will be subject to these new borrowing limits.

Eddy: So this is for Parent PLUS specifically. There’s an annual limit of $20,000 per student, and also in addition to that, a lifetime limit of $65,000. So what this means is that… And that’s per student as well. What this means is that you might borrow $20,000 the first three years, and then in the final year, senior year of college, you’re only eligible for $5,000 remaining.

Eddy: I’ll illustrate that in a moment and what [00:38:00] that looks like through coming back to UCLA’s example. But that is a significant change. For any current college students, I wanna make a quick distinction here. Current college students, you may not be subject to these terms. You started college before this law was passed, uh, and it’s going into effect on July 1 of this summer.

Eddy: So you were already enrolled in college, so it is possible to be grandfathered in and be granted the legacy exception to that. And so to be granted the legacy exception, uh, you have to have previously taken out a federal loan, so either the Parent PLUS or the, uh, Federal Direct Loan for the student. The student has to stay enrolled in their university.

Eddy: The same program, same university. And so if you transfer, you actually will lose your eligibility for the legacy exception. You will lose the [00:39:00] grandfathering clause, uh, exception. So you have to also stay enrolled in your program and in your university But if you do that, if you meet all the requirements of being granted the legacy exception, then these limits do not apply to you and your parents are able to borrow up to the cost of attendance.

Eddy: So that was previously the limit. You could borrow up to the cost of attendance minus any grants and scholarships that were received. So if that’s applicable to you, I generally recommend leveraging that because more than anything else, it serves as an insurance policy. Um, f- the, the Federal, um, Parent PLUS rate, as we saw, isn’t a great rate, but it’s also not the worst rate that’s out there in the marketplace.

Eddy: And so having the security of knowing the worst rate that you might see in the marketplace is 9.07%, or it could potentially change a little bit, um, next year too as well, that serves as a, [00:40:00] an extra insurance policy for the family if you maintain that eligibility So let’s come back to this example, as I was mentioning, where the student received a $5,000 scholarship and the family used $10,000 in savings.

Eddy: The student’s gonna maximize their direct loan, and also the parent is gonna maximize the Parent PLUS Loan. So what we see here is that in year one, there’s going to be an unmet need of about $4,800. So the family will figure out… You will have to find– figure out a way to pay for this. It could be an, an additional loan that you might apply for.

Eddy: It could be, um, could be work-study, uh, that isn’t included in this calculation. The student could get a job. Sometimes parents might work overtime. Sometimes families might use extra savings that they might have available. So you see the difference, uh, kind of… You, you see the unmet need over time. Now, it does reduce by $1,000, uh, to [00:41:00] year two and year three because the student is able to borrow more through the Federal Direct Loan.

Eddy: So it goes from $5,500 to $6,500 to $7,500. Now, from here, what’s really important is the senior year unmet need amount, as I was mentioning earlier. If you’re borrowing $20,000 in years one, two, and three, then your limit is… The lifetime limit is $65,000, and that is per child. So $65,000. So you only are eligible to borrow $5,000 in senior year.

Eddy: Now, don’t ask me why it wasn’t just set… The limit wasn’t set to $80,000. That would’ve been a little easier and more straightforward, but that’s not the case here. And so in senior year, there’s an even higher unmet need amount where the family is likely going to have to take out additional loans to help meet this gap.

Eddy: So [00:42:00] over the course of these four years, it’s not only the, the amount that you borrow through the Parent PLUS program, but then also over $29,000 in additional unmet need, and the family is responsible then to figure out how to pay for that. So Parent PLUS may not be enough. For some it may be, and that’s totally fine, and if that’s the case, you can leverage the Parent PLUS.

Eddy: But this is why it’s important, uh, for families to know what options are out there. And so whether it’s through federal options, uh, the Federal Direct Loan or the, or the Parent PLUS loan, it’s important to know what exists on the federal side and then also the private side because you might a-actually be forced into the private loan market given these changes to borrowing limits, uh, through the federal government.

Eddy: And so let me just spend a little bit of time. I’ll talk about private loans and then a little bit about, um, the work we’ve done, uh, about Juno… with Juno. Uh, and then certainly please, uh, feel free to post [00:43:00] any additional questions in the Q&A. Um, on the private loan side, usually there’s no origination fees.

Eddy: Um, and the interest though is based on credit. And so many factors that lenders will look at in their underwriting criteria, so like I mentioned before, credit score is a big factor. Income, debt-to-income ratio is considered. And so not every family will qualify for private loans. Now, this is the, the fundamental challenge, where if a family does not qualify for private loans, then all you have is the opportunities available in the, through the f- the Federal Parent Plus program.

Eddy: Is that going to be enough to cover it? If it’s not, then that places the family in a really difficult position of figuring out how they’re g- how they can pay for college. How do you fill the gap if you’re not, um, if you’re not able to qualify for additional funding in the private loan market? [00:44:00] That’s the fundamental inequity that we’re, that we’re about to experience when this law goes into effect.

Eddy: Now, generally, private lenders have, uh, minimum credit score requirements. It’s around six hundred and fifty or so. Usually some- sometimes it can be a little bit higher. But just because you qualify at the minimum level doesn’t mean that you would get a s- an attractive rate. So I also wanna emphasize that.

Eddy: You can qualify for a private loan, but then also qualify for a private loan at high rates, which makes it very expensive to take out So that may also not be ideal, and it w- it can potentially cost families even more to, um, to take out, uh, loans in order to help pay for college. This is why it’s so important for everyone here to understand what your options are, because this can cost you quite literally thousands of dollars, if not even more, uh, over the course of a life of the loan in terms of the interest that you might be paying.

Eddy: Um, because the [00:45:00] difference in even one percentage point on a loan is, is quite substantial as you compound that over ten years or fifteen years of a loan. For private loans, generally the student is the primary borrower on the loan, and they need to have a cosigner. So s-students usually don’t have income or, or a credit score or a long history of credit, so a cosigner is, in most cases, required.

Eddy: Usually it’s the parent. It doesn’t have to be a parent. It can just be any credit-worthy cosigner who’s willing to cosign that loan. Um, but in most cases it is a parent, um, so I’m just gonna assume that from here on out. And the borrowing limit is up to the cost of attendance minus any grants or scholarships received.

Eddy: So you can choose whether it’s a fixed rate or variable rate interest rate loan, and then different payment terms. So five years, um, some lenders have seven years, ten years, uh, twelve years, fifteen years, and in some cases, even twenty-year loans. [00:46:00] So the longer you spread it out, again, you might see different interest rates.

Eddy: For example, five-year interest… uh, excuse me, five-year term loans, uh, usually have s- better interest rates ’cause lenders are getting paid back sooner than you might see in fifteen or twenty-year interest rates. And then also importantly, uh, you can select between different payment options in terms of when the payments begin.

Eddy: You can do immediate repayment, which is you’re paying the principal and the interest right away. It’s not, usually not common at all. I’ll share some numbers with you, at least in terms of the Juno families who consider these different options. But that is one, principal, uh, principal and interest payments.

Eddy: You can do interest-only payments. You can do a small fixed um, uh, fixed payment. Usually it’s about twenty-five dollars a month. Or you can do full deferment. Now, today, private loans are an alternative to Parent Plus, uh, for those who have good credit. So if you have a strong credit, then you may actually qualify [00:47:00] for better rates, right?

Eddy: If you’re comparing the nine point oh seven percent Parent Plus rate to private options, if you qualify for pri- uh, better rates in the private loan market, then that can save you a lot over the course of that loan. In July, once this law goes into effect, uh, families might need to think about private loans because you may hit your Par- your Parent Plus cap, and you’re ineligible to borrow even more from there.

Eddy: If you’re thinking about exploring the private loan market, again, this is not to pressure you into it, but this is more so just a reality of where we are now in how families are going to choose to pay for college, given the federal changes that, that are happening, uh, very soon here. So after the student has taken out a Federal Direct Loan, then that’s where you explore between private loans and even Parent PLUS options.

Eddy: From there, if a family does want to have the [00:48:00] chi- the student’s name p- as part of that agreement, then you can consider private loans. For Parent PLUS loans, the student is not legally responsible. There’s nowhere to put their information on that loan. It is solely the responsibility of the parent. You do have to have good enough credit to qualify for, but again, if you do meet that maximum borrowing limit to the Parent PLUS, you might actually need to look through private loan options then So through, uh, through the rates that we offer at Juno, uh, we sort of negotiate with multiple different lenders, and so you can explore what you might, what rates you might see, uh, without it having impact on your credit score.

Eddy: Let me just share a little bit more here. I talked about these four options: deferred, fixed payments, interest only, and immediate repayment. Now, in terms of families that, uh, that use Juno, it’s very common for families to either defer fully, so you’re not making any payments until after the grace period, uh, or to choose [00:49:00] a small fixed payment amount, which is about twen- usually $25 a month.

Eddy: And so many lenders, uh, at least the ones that we partner with, will offer a 0.25% autopay discount on this option. So if you connect your bank account and then they withdraw $25 every month, they will incentivize you to do that by offering you a slight reduction on your interest rate. So that is attractive to many families ’cause it’s…

Eddy: you’re able to lower your interest rate, and again, 0.25% doesn’t seem like a lot, but it does add up. You can, you can do the math on it. Um, let’s say on a 10-year loan, for example, uh, if you are borrowing $30,000, what the difference is, uh, if you, if you have that slight reduction. So that is important to know.

Eddy: Um, this isn’t to, to have you, you know, sway you in one direction or another. These are just, um, realities of where most families are in the process. If you do an, an immediate repayment option plan, generally you’re gonna pay the [00:50:00] least in interest. So of course, if you can afford that, if that’s in your budget to start making payments right away, I’m all for that.

Eddy: Uh, ’cause in the long term you will pay the least amount in interest. But that’s also not a reality for some families. I was actually just talking to a dad yesterday who was considering that as a, as an option, but he also has two more children coming. Uh, he’s, has a rising, uh, rising freshman in college and two more children coming after.

Eddy: And so a commitment to immediate repayments just with two other, uh, two other students incoming who are in high school already and going to be in college in the next few years, it’s not realistic. It’s not a realistic plan for him to be able to commit to. That’s not to say that it’s not possible, but there’s, uh, many factors that go into these decisions Um, a couple other important things to know is that families borrow one year at a time.

Eddy: So aid is calculated on an annual basis. Cost of attendance changes on an annual [00:51:00] basis, so as a result of that, the amount that you might need to borrow also changes on an annual basis. So from that, then you can explore, uh, you apply every single year. Uh, you can’t apply once and then have that, have that cover all four years.

Eddy: You take it on an annual basis. It is certainly possible, and we get this question a lot, to begin making payments above, above and beyond what your minimum payments are. And if you can do that, then that’s great, ’cause again, you’ll, you’ll pay less interest in the long run. Um, there’s no prepayment penalties on the federal side and then also on any of the lenders that Juno’s partnered with.

Eddy: And, uh, interest does accrue as soon as the money is sent to the university, um, when that tuition due date is due

Eddy: Now, let me just spend a moment here, uh, talking about this and then, um, uh, and then we’ll, we’ll get to Q&A as well. [00:52:00] So the reason we recommend applying early is To see what rates are available. June is a really popular month for students and families to explore this. Lenders know that. And so for example, uh, l- yesterday, uh, I was actually just saying, uh, yesterday we saw a fairly significant drop in interest rates on Juno’s platform, uh, with some of our partner lenders than what was previously available in, in weeks past.

Eddy: If you submitted a rate check before, so even e- last week, and, uh, this is a, a really important note here. If you did a rate check through Juno’s website last week, please rerun it again, um, because yesterday new rates came out and they’re much lower for many, many, many families. So you may have done that.

Eddy: You may have seen… Again, it, it, it still is dependent on individual, uh, credit profiles. [00:53:00] But if you ran a credit check, uh, a rate check, excuse me, not a credit check. If you ran a rate check through Juno’s website in the past, please rerun, rerun one again today because as of yesterday, rates dropped. Um, we don’t know how long the rates are going to last.

Eddy: Um, again, Juno is not a lender. We, we negotiate with lenders, but we actually brought them this feedback with a lot of our partners, um, College Advisor being one of them and many others. We were getting feedback both directly from families calling Juno and then also from several of our partners saying that families are seeing, uh, quite high interest rates.

Eddy: We spoke with lenders, um, and they responded accordingly. So that is sort of the power that we have in terms of working on behalf of thirty thousand families. Now, I don’t know, um, and there hasn’t been communication with the Juno team as to how long these rates will last. This is not to pressure you into like act now, move [00:54:00] quickly.

Eddy: We do wanna balance that. I want you to do your due diligence, and you absolutely should. Shop around, explore many different options that are out there. Explore what rates are available through Juno, explore rates w- that are available through any other, any other lenders that are available. From there, what I wanna emphasize is there are times rates can change monthly, and in some cases, depending on the priorities of each lender, they can change weekly, or there may be some, some particular weeks that are better than others.

Eddy: And so as a result of that and what we’re seeing now, this is a, this is a, an especially optimal time to apply. If you apply, um, so you can do a rate check first, that’s step one. That won’t impact your credit. Then the next step is actually submitting a full application. Once you do that, then that locks in your rates.

Eddy: You see which, uh, what rates you would, can qualify for. And then you usually have 30 days from there to make a decision before that expires. [00:55:00] So in that process, if you see rates that are, uh, that you’re happy with, you can move through the process, lock it in, and you have the rest of the summer to relax, or you can keep shopping around, that’s totally fine.

Eddy: Your loan won’t get dispersed until the academic calendar tuition due date, which is usually in August or early September, depending on the university. So just because you’ve secured the funds, the interest doesn’t begin accruing. The interest only accrues once the funds are sent to the school in August or September, early September.

Eddy: So up until that point, you can actually cancel a loan. Uh, so the reason I say that that’s im- uh, that’s important is because if you secure a rate now, then that’s, that’s good. If rates drop in July or in August and they go down, that’s great news. You can reapply for another loan, and from there, you have the [00:56:00] security of what you’ve already secured.

Eddy: Uh, excuse me. The security of what you’ve already locked in. But if rates go down, then there is going to be a, a slight impact on your credit score because it will actually, it will have to run your credit again. However, you get the, the benefit of having a lower rate, uh, so later down the road. Now, that would be a good, uh, a good scenario.

Eddy: If, for example, you locked in rates now and interest rates go up in July or go up in August, then you’ve locked in a lower rate now than what is going to be, uh, potential, a potential in the future. Now, we don’t know where rates are. I can’t predict where they’re gonna be, you know, in a week from now, in a month from now, in a year from now.

Eddy: So this is why we encourage families to be diligent in this, in this process. Explore all the different opportunities that are available out there. If you see a rate, um, that works for your family, lock [00:57:00] it in just to protect yourself from the instability or the volatility that we’ve been seeing a lot of in the market, uh, recently of the fluctuations.

Eddy: Happy to talk more about that, um, if, if you’re curious. Um, but again, that’s really where, uh, Juno has stepped in. I wanna say one last note here. You have 30 days to shop around, so as long as you’re shopping for the same type of loan product, which is in this case is student loans, you can apply to different lenders and that’ll count as one inquiry on your credit report.

Eddy: Uh, so as long as it’s, again, it’s for the same type of loan, which is, uh, student loans here. One final, uh, benefit is, uh, two final notes here. Um, all Juno families actually get a 1% cashback bonus just for being a Juno member. So if you take out a $30,000 loan, you’d get a $300 cashback bonus. But if you go through the rate match program, uh, which is actually o- one of our partner lenders has a rate match guarantee.

Eddy: What that is is basically you shop around, you explore different options [00:58:00] out there. We have 11 different lenders that we can rate match with, and if you get a better rate through them, that’s great. We actually actively encourage you to shop around so you can find the best rates for, for your family. And then bring that to us.

Eddy: We will process a rate match, and then you’ll get the same rate that you qualified for, plus a 2% cashback bonus. So we bump it up from 1% to two- 2%. Um, so that’s how we’ve made it to be the most, uh, beneficial option for most families. Juno’s completely free. Uh, there’s no cost to sign up. We never ask for your money.

Eddy: Um, there’s no place on our website to input your financial, like your credit card information or any form of payment. Um, you don’t have to do, um… there’s no– checking your rates doesn’t, uh, doesn’t require a hard inquiry on your credit report. Um, there’s no hidden fees through, uh, the Juno platform or our partner lenders.

Eddy: Uh, and then I’m always happy to meet one-on-one with families. We have a whole team devoted to this. If you have specific questions, we can, [00:59:00] um, we’re more than happy to, to address that. So as I mentioned here, this is just a little bit about the cashba- uh, the rate match guarantee program. Um, so you basically will, uh, fill out the information.

Eddy: We can process the rate match for you and then give you that extra 1% cashback bonus. Here’s a QR code, uh, if you are interested. I strongly suggest, again, this isn’t– I, I always wanna be cautious, um, because families have certain timelines that they need to meet. I understand that. Um, but I’m only sharing this because we saw this rate drop yesterday.

Eddy: Um, and it is important to leverage, uh, timing in this over this summer, um, ’cause there are periods in which, uh, generally there are better rates, and then there are periods in which there, there are going to be worse rates, uh, depending on, uh, on macroeconomic factors. And so we’ve been– we were in a period where families saw historically not so great rates, um, you know, two, three, e- two, two, three, uh, two, three weeks, I [01:00:00] guess even last week, I should say, so one to two to three weeks ago and even beyond that.

Eddy: And now we’re kind of in this period where, uh, there’s, uh, there’s good rates that are available for many, many families. Uh, and then from there, s- we’ll see kind of where we go from here. Um, but yeah, let’s, let’s look at some of the questions that are present here.

Anna: Great. Thanks so much, Eddy. Um, we hope you found this information helpful. Just a few reminders before we dive into the Q&A. You can download the slides from the link in the Handouts tab. This is being recorded and will be emailed to everyone who registered. Uh, when we get to each question, we’ll try and read it out loud and paste it into the public chat so everyone can both see and hear the question before Eddy responds.

Anna: If your Q&A tab isn’t letting you submit questions, just double-check that you joined the webinar through the custom link in your email and not from the webinar landing page. [01:01:00] Um, Eddy, I saw you scanning. Is there a question you wanna start with, or do you want me to just, uh, toss some your way?

Eddy: Sure. I can see a couple here.

Eddy: Um, so in terms of, um, sort of budgeting, for example, or, or college finance planning, you have about 50% of the cost of attendance in a Five Twenty-Nine. If you need, uh, you need loans for the other 50%, how to distribute. Use Five Twenty-Nine year one and two. So that certainly is an option. I wanna be, I wanna be really mindful ’cause, again, I’m not…

Eddy: I don’t wanna give wholesale financial advice. I encourage you to reach out to any financial planners or financial advisors that, um, can help you independently for your circumstance. I’ll share just a couple thoughts here, though, is if you do use those funds, as I mentioned earlier, those would be fewer reportable assets on your financial aid, uh, documents that you then have to sub-submit.

Eddy: And so leveraging those can be helpful, one, for that reason, but also on delaying the, the timeline of [01:02:00] when you need to take out loans and any interest that accrues. Because interest accrues the moment a loan is disbursed, then you may actually… You… At that point, then it is going to be costly to take out that loan.

Eddy: If you can avoid that, that’s great. The reason I, I emphasize caution here is because That, that certainly can work. But also, I always wanna be mindful about any levels of income stability and potential instability. So a 529 is an asset that the family holds that is available. If there is, um, uh, ins- unstable income, so maybe if a parent has had, uh, you know, is in an industry that is either particularly volatile or, um, or sort of prone to layoffs, for example, I wanna be really mindful because those are very [01:03:00] real funds that are available for families that might be necessary in case of emergency.

Eddy: That’s why there’s no one-size-fits-all answer here. There’s a lot of what-ifs. I’m happy to, to kind of speak more individually in a longer conversation, but that’s … Those are some of the ways that I think about it. It absolutely can be helpful to delay paying interest for two years. If you have the savings available, that’s great.

Eddy: Um, but just know that, uh, there’s more, a little bit more nuance to it

Anna: Thanks, Eddy. How long, do you know, between applying for a private loan, how long does it take to actually get the money? So Douglas is saying he doesn’t know what his net payment will be after grants and scholarships until like a week or two before school starts.

Eddy: Yeah. So great question. This is a, a very common question that I’m, that we’re hearing, uh, right now as well. So it is best to give, to make an estimate. So if you don’t fully know, uh, [01:04:00] and- Usually colleges will send their, their updated cost of attendance sometime in the summertime. It might still be a little bit early now, it’s only June 9th.

Eddy: Um, the universities are working on this, on setting the, the, you know, both their academic calendar and also the cost for the upcoming year. Usually it’s in the midsummer where you’ll be able to get this information. If you don’t know, then that’s okay. It’s, it’s best to use an, uh, an estimate. Um, and so what I mean by that is use the cost of attendance that was published for last year that’s on the financial aid offer that you received.

Eddy: And then from there, overestimate just a little bit in terms of the amount if you don’t know exactly what tuition is going to be for next year. Um, it’s always better to overestimate a bit than to underestimate, especially if you’re looking at private loans. Because if you overestimate, let’s just say you can be all- you can be approved for a $40,000 loan but [01:05:00] only need $35,000, and that’s fine, uh, and the school will only certify $35,000.

Eddy: The remaining $5,000, nothing happens with it. That doesn’t get distributed. You can always be approved for more and need less, but if you submit a lower amount and need more, then you might actually have to apply again for a separate loan for that 5,000. You know, if you apply for 30 and actually need 35, then you might need to apply for a second loan for that extra $5,000, which is not ideal because it’s gonna run your credit again.

Eddy: Now, in terms of the different, uh… in terms of the length of, uh, sort of private loan and then actually getting the funds, the, the approval process can actually go fairly quickly, um, within a day in some cases, uh, if you are applying for private loans, sometimes even same day. Um, but I generally say like leave about one to three days ’cause it can depend on time of the year and how busy lenders are at fair- you know, summertime is going to ramp up a lot here.

Eddy: And then the other piece of that to, to be [01:06:00] mindful of is it does take about a week, sometimes even longer, for a school to certify the loan on the back end. So they essentially have to confirm that the student is in fact enrolled in that university and the borrowing limit. So we, we talked about the borrowing limit previously, which is the total cost of attendance minus any grants and scholarships.

Eddy: That’s your borrowing limit. So you are not able to borrow more than that amount, so a school has to confirm that. So that’s what they do when they certify the loans, and that can take about a week, depending on when, when it is. I don’t recommend waiting until like late August, ’cause that’s when financial officers are slammed and it can take even longer than a week.

Eddy: Um, so do that. But the… once that loan is certified- The university works directly with the lender to give them the, the due date for the d- uh, for the tuition deadline, and the lender will then transfer the funds. So you don’t actually have to be a part of that process. So that’s fairly straightforward, um, the school will determine.

Eddy: Now, up until that point, up [01:07:00] until that disbursement date, you can be approved for a loan, and then you can just sit back, relax until that deadline comes. You don’t, you don’t have to take an active role. You can cancel it, like I mentioned earlier, uh, up until that disbursement period. If you find that rates go down later in the summer, you absolutely can do that.

Eddy: Um, but from there, um, that period of time, once you have secured your funds to the moment tuition due date is, if you’re happy with it, you don’t have to keep exploring, uh, you can just wait for the school to handle it with the lender directly

Anna: Thanks, Eddy. Someone is asking to see the QR code again. So I’m going to just leave that QR code on the screen while we continue the, the Q&A, if that’s fine with you.

Eddy: Mm-hmm. Sure.

Anna: Um, we have a question from a parent who is international. Are they able to apply for the loans you’ve been describing?

Eddy: Great question. So the… [01:08:00] Typically, the loans are, um, currently our rates are for US-based co-signers. There are some options I’m happy to email. I f- I did see this question, I forget who it was, but, um, I, and I can’t find it now.

Eddy: But if you email me directly, I’m happy to share some of those other options. Most our lenders are primarily h- primarily have requirements for a US-based co-signer. If you’re an international student or an international family, um, it, the… You would not meet those eligibility requirements. Um, if some families have been able to find, uh, or if you have a relative, for example, who is in the US, there are some workarounds like that, or if you’re able to, to secure a US-based co-signer.

Eddy: There are other lenders, we’ve not currently partnered with them, but I’m happy to share. There are other lenders, um, that work specifically with international students and international families. They do generally have higher interest rates, unfortunately. Um, and you know, I [01:09:00] can share more about why, but, uh, I’ll just, I’ll leave it at that for now ’cause I see we have a lot of other questions.

Anna: We do, and we’ll get to as many as we can over the next maybe, like, five minutes. Um, let’s see. Eddy, do you think if parents are married, should they apply jointly for the loans, or s- should just one of them apply?

Eddy: Uh, great question. So here you can, um, on private loans, it would be a student who’s the primary borrower, and then one parent.

Eddy: You don’t need both. You can certainly, and I would actually encourage both parents to do a rate check, ’cause there are cases in which one parent gets a better, uh, better rate than another. If one parent has a particularly higher credit score, it’s a very common example. I was actually just talking about this with a family last week, um, where one parent had a significantly higher credit score.

Eddy: And so if that’s the case, you can use that parent, uh, that parent’s information

Anna: Thank you. [01:10:00] Um, here’s a question from a student. Why am I held to my parents’ tax level if they aren’t willing or able to help me pay for any of my college? Is there anything I can do?

Eddy: Good question here. So that is the, the, the expectation that universities have is that parents are responsible for their child’s undergraduate, um, expenses.

Eddy: If that’s not the case, that puts the student in a really difficult scenario. Um, and, and I’ve actually… I had a student I worked with when I was a college counselor who was in this scenario, um, where the parent, there’s a ver- it was a complicated s- situation and, um, you know, we don’t need to dive into it, but it does put the student in a very difficult position if the parents are unwilling, uh, to contribute.

Eddy: An unwillingness to pay is not the same as [01:11:00] an inability to pay, as colleges consider it. So just because a parent is unwilling doesn’t mean that they’re not capable of it. Um, uh, in addition to that, typically, again, universities will expect both parents to be, um, at least those that require the CSS Profile.

Eddy: Um, in the case for FAFSA, if parents are divorced, only one parent’s information is requested, and it’s the parent who provides more than 50% of the financial support for the child. But in the case of CSS Profile, um, universities generally expect both parents to contribute. So again, any kind of unwillingness is not, is not going to be sort of in the eyes of the university financial office, that’s not a valid reason.

Eddy: There are certainly other valid reasons, so if there’s been any kind of dangerous situations, abuse at home, like absolutely there’s, there’s ways to waive the parent- parental requirement from that. Um, [01:12:00] but that is… I j- I wanna be upfront and honest about sort of some of the upcoming challenges. I’m happy to, to connect directly if there’s, it seem, it seems like this might be a longer conversation.

Anna: Thank you, Eddy. Um, can both parents file separately for loans, like for half, each file for half the amount?

Eddy: Uh, y- yeah, you can. Um, it’s … You certainly can. It’s not something that I’ve, um, seen a lot of families do. Um, but you, you certainly can do that. It is an option. You’d have to each… The only thing, the re- the only reason I hesitate on that is you just have to manage a lot of different like logins with different lenders, which can be fine as long as you’re willing to do

Anna: that.

Anna: Um, what if families really cannot afford the SIA?

Eddy: Yeah. So I think, um, I think it’s probably referring to the Student Aid Index. Um, and so [01:13:00] if that’s the case, it can be, it’s worth- Connecting with the financial aid office and understanding if there’s something missing. Uh, maybe you forgot to include some information, um, appealing your financial aid offer, connecting with the university to see is there something that, um, is there some information that may have been either left out or that is, is impacting the cal- overall calculation.

Eddy: If there’s a dramatic difference, um, double-check with the net price calculator as well. I would encourage doing that. It takes about half an hour to complete. Um, but double-check with the net price calculator tool that every college is required to have on their financial aid website, and then see wh- again, it is an estimate.

Eddy: The best form is generally the financial, the actual financial offer that you receive. But if there’s a big difference there, that might give you, um, re- it might give you good reason to go back to the financial office and say, “Hey, [01:14:00] did I make a mistake? Did I include everything? Did I accidentally include something I wasn’t supposed to include, which may have inflated my student aid index number?”

Eddy: Uh, if that’s the case, then it’s worth having that conversation and appealing your financial aid award

Anna: Thank you. Do you have time for one more question, Eddy?

Eddy: Yeah, I do. I see we still have a couple. I’m happy to still go through them.

Anna: Okay. Um, I’m gonna try and combine two, um, that are about being grandfathered in.

Anna: So i- we have one family where they took the Parent PLUS loan, um, and the federal loan last year, and then another family where they only did the federal loan last year. Will they both be grandfathered in, or do you need to have done the federal loan and the Parent PLUS loan last year to be grandfathered in?

Eddy: As long as you’ve done one, you should be fine. There’s a few other eligibility criteria as well. It’s not just that. Um, so the student [01:15:00] has to maintain eligibility, um, by being enrolled at the university as well, uh, maintaining enrollment. Um, you cannot transfer universities. Um, and then there may be one more.

Eddy: Um, I can follow up on that, but there’s a couple, there’s a couple, um, couple stipulations. It’s not just that one. And a s- and a family s- a student has to meet all of them

Anna: Thank you. Um, did you wanna just try and knock these out now, Eddy?

Eddy: Yep.

Anna: Okay.

Eddy: Um- I see one from … I’ll just, uh, I’ll just address quickly here because it’s a great, it’s a great question, but, um, uh, can you still make payments even if you’re on deferment?

Eddy: Yes. Uh, so you can … If you’re able to make payments, even if you fully defer your terms, that would be great, um, because you would then pay off your loan sooner. Uh, or even if you can make the minim- even if you can make the interest [01:16:00] payments, if, if you s- even if you didn’t select that as an option, you can still make the interest payments.

Eddy: You can do that prepayment option where there’s no penalty for that, and then if that’s the case, interest won’t accrue. If you can make any payments above that, then you’re, then you’re applying those payments to the principal, and that reduces the principal. So if you have the funds for it, absolutely, I would encourage that.

Anna: What if someone, Eddy, wants to utilize loans before their savings so they have an emergency cushion? Uh, do you think that’s advisable?

Eddy: Yeah. And so this is exactly why there’s no, um, uh, uh, there’s no sort of one-size-fits-all answer and, and I was trying to share that with the example with the parent who asked about, you know, using funds for both years one and two if you can fully cover it.

Eddy: Having any kind of emergency savings if you don’t, um, is helpful, right? Like, I would not want a family to utilize all their funds and then have some kind of … [01:17:00] Life happens, right? Like, maybe a parent loses a job, maybe there’s a medical emergency, uh, and then not be able to meet other life obligations, right?

Eddy: So you wanna be really careful. I, I emphasize that, um, because it’s not just about paying as little interest as possible. Obviously, yes, that’s great, but there’s other things that are important to be mindful of and to have some kind of reserves if you don’t already, any kind of emergency savings so that should some unforeseen circumstance arise, that wouldn’t put you in, uh, or the family in a really difficult position, right?

Eddy: You can still make, you know, your payments on bills, on your mortgage, on other things. Like, that is a very important point that, uh, that this question is bringing up. So yes, absolutely. Like, if that’s the case, it may be worthwhile. Again, certainly depends on, on how much savings you need and how much you feel comfortable with.

Eddy: Um, but that could be an option to also [01:18:00] explore alternatives in terms of, um, any additional, um, loan source, any loan sources in order to maintain that, um, any, any reserves that a family has

Anna: Here’s a question about Juno. Do you broker a reduced rate with one preferred lender or with a variety of lenders?

Eddy: Yeah, great question here. So we work with a small number of lenders. Um, so in terms … The broker model is the easiest way to think about it, um, but we also don’t work with that wide of a range of lenders. Um, the lenders have to be willing to meet, um, certain … Be willing to make certain concessions that benefit the Juno audience, so Juno- all the Juno members.

Eddy: Um, and we have different lenders for different programs. So for example, undergraduate versus specific graduate programs. There are some lenders that offer better rates for MBA degrees, some [01:19:00] that offer better rates and terms for, um, MD degrees or other health degrees. So there’s a combination of different lenders, but, uh, what you’ll see on Juno’s platform if you check your rates will always be the most competitive rates based on the information that you submitted to us.

Eddy: Uh, we ask some very basic questions, which basically mirrors what all lenders will ask for in rate, in rate forms. And so then the rates that you see on Juno’s platform are the- going to be the ones that are the best given your circumstances.

Anna: If a parent has a tax lien, does it make sense to apply for Parent Plus to get denied so the student can then get the higher independent status?

Eddy: That’s a good question. I ac- I’ve never gotten this before. Um, s- certainly … Yes, you certainly could. Um, and that, that would allow the student, at least for freshman year, to borrow. Again, if, if the parent does have any kind of those adverse credit e- [01:20:00] event histories. It’s not a guaran- I, I wanna be careful.

Eddy: It may not be a guarantee that you’re denied, but it’s much more likely that you would be denied. And so if that’s the case, then yes, the student would actually be able to borrow up to 9,500 in that freshman year, and then it would be at the 6.52% interest rate loan, um, which can be a, a fairly good rate actually, uh, in today’s market

Anna: Thank you.

Anna: If a private loan has a fixed rate below the Parent PLUS loan’s 9%, i- is there any reason to not take that private loan?

Eddy: That’s, that’s the most common reason we see parents going the private loan route. Um, so historically in the past, because with Parent PLUS, so for, uh, again, many parents who are, who are on this call now have children in college.

Eddy: So this, this would be what you are used to. Before you could borrow up to the cost of attendance through the Parent PLUS [01:21:00] program. So effectively, Parent PLUS was the default, where unless you, unless you could get something better in the private loan market, then you would always go Parent PLUS. Um, you know, and last year it was 8.94%.

Eddy: Again, it also went up 13 basis points this year. But before, if you were seeing rates w- better than 8.94%, families would go private loan market. If you would see rates worse in the private loan market, worse than 8.94%, then they would just go full borrowing through Parent PLUS. You had no reason to borrow in the private loan market at worse rates because you could borrow up to the cost of attendance through the Parent PLUS.

Eddy: Now, the significant change now is that Parent PLUS is no longer the default. It, it can be helpful up to $20,000 per year, $65,000 lifetime, but it is no longer the default anymore. So yes, if many families who see better rates will go private loan, but the, the [01:22:00] complication comes is when you see, when you might be seeing worse rates and how do you navigate these different options

Anna: Could you briefly explain the difference between fixed and variable rates?

Eddy: Yeah, great question here. So fixed, um, a fixed rate loan, you’re paying the same… The- your interest rate remains consistent over the life of that loan. So if you select a 10-year, 10-year loan term, uh, and you get a rate of 7.5%, your rate will be 7.5% for the full duration of that, that loan. Variable rate interest ra- uh, variable rate loans will fluctuate based on, uh, overall market conditions.

Eddy: And so it uses, uh, a f- the federal, a federal rate, um, uh, and then it, it’s a SOFR rate, and then there’s a spread that’s added on top of that, and that’s the money basically that the, the lender makes. So they always add a spread on top of it. Uh, and from there, that is, uh, [01:23:00] uh, basically where the market rates are is subject to change, and the spread will generally remain consistent, but the market rates can change.

Eddy: So they can go up, they can go down. So if you select a variable rate over the course of 10 years, then you’ll be– you’ll likely see different interest rates as, as the market moves up and down. So rates could go down, and if that’s the case, that’s good, uh, because then you’ll, you’ll end up paying lower in interest.

Eddy: But equally so, the rates could go up in the market, and that would be less than ideal. Um, a lot of families choose the fixed rate option just for the stability and the, the planning purposes of it. Um, it’s generally where we– at least what we see with Juno families. But again, there’s… It, it’s up to your own level of risk tolerance and where you think the market is going o- over the course of, you know, the next five to 10 years.

Anna: Thank you. On Juno’s website, when folks, um, check their rates, uh, on the, the initial [01:24:00] form, um, how close are those rates to the actual rates they get when they fill out the application with a hard credit pull?

Eddy: Yeah. It should be the same rates, if not very, very close. There sh- If you’re seeing differences, please let me know or let us know at Juno, um, because for the most part, there shouldn’t be differences in, in that process.

Eddy: Um, m- it could be, again, slight, but if you’re seeing dramatic differences, then please let us know ’cause there might be some, some issues going on on the back end

Anna: If a family is currently a one-income family, i- it sounds like that might be changing soon. Do you think they should wait until they’re a two-income family to get a rate check?

Eddy: Um, it can depend on how soon. Um, so generally one, one parent information is required. There are… Like, there is a, a, a question that asks not just, uh, cosigner income, but household income as well. [01:25:00] So in- that would be the, the consideration there is you would have a higher income if there’s a two-parent… uh, excuse me, a two-income household.

Eddy: But it’s worth exploring now and seeing what is available. Again, if you actually choose to, um, the primary information will be used at is the cosigner on that form. Uh, and so it’ll be, again, on the private side, it’ll be a student who’s the primary borrower and then the cosigner, whichever parent it might be.

Eddy: Um, presumably, I, I would… In, in a one income household, it should be the parent with the income, uh, who submits that form. Um, so that’s gonna be more important. You can try that now and then see what rates you get. And then if the income is, um, if the income is upcoming soon, there still does have to be verifiable income.

Eddy: Uh, and so depending on how soon this job might come, uh, can depend on the, on the [01:26:00] timing of when a family actually has verifiable income to, to prove.

Anna: Uh, they sent a follow-up, two weeks. Uh, so it’ll be coming pretty soon- Oh, okay. Sure … uh, the new job.

Eddy: Sure.

Anna: Uh, what questions should families think about asking financial aid offices?

Eddy: Yeah, excellent question here. So as you’re thinking about, one, just… I- I’m thinking about this like we can take a step way back, and this can be questions for both admissions and financial offices. Does the school meet 100% me- uh, 100% demonstrated need? Um, is the school need-blind in the admissions process?

Eddy: So that’s admissions policies. Uh, and as a former admissions officer, like these are the things that are ingrained in my mind. Um, understand some of the very basics of, uh, how aid is calculated and how it impacts your admissions application. What are things like what is the, you know, what is the average debt that students hold after they graduate?

Eddy: [01:27:00] Um, the average in, in debt is what is the average scholarship that students receive? Um, again, it’s hard to know because, uh, some schools offer significant fi- uh, merit scholarships, some don’t. But do they offer merit scholarships? What o- what opportunities are available? Uh, it’s really important for families, especially younger families, to think of…

Eddy: This was always important, but even more so with these federal changes happening. How can you maximize your credit score fro- from an early start? So especially if there’s families who have a, a child going, you know, two, three, four years from now going to college. Think about maximizing, um, or improving your credit score as much as possible ’cause material differences…

Eddy: Uh, you can see materially better rates with a very strong credit score versus an average credit score. That’s gonna be super important. Then as you’re thinking about the financial aid piece, what forms are required of you? Um, and then not just… You can ask financial office, you can ask, you know, [01:28:00] us, college advisor, any folks, like we all share, um, information on the college financing journey.

Eddy: And so what forms are required? What should you include? What should you not include in your financial aid, uh, information? So for example, on the FAFSA, you should not include the value of primary residence on that. Um, I don’t know if you knew that or not, but there’s some things that you should and shouldn’t include on that.

Eddy: And so if you over-inflate your assets, then that’s gonna show… That could potentially sh- uh, impact the, uh, financial aid offer that you receive. It could impact your student aid, student aid index number, which impacts the financial offer that you receive.

Anna: Um, if… Thank you, Eddy. I- if parents have, uh, a credit freeze on their account, um, maybe due to a fraud alert, how far in advance should they remove that freeze before applying?

Eddy: Yeah, you will have to, [01:29:00] uh, remove that. I would say A couple of days should be fine, um, but you know, about a week to be on the safe side.

Anna: And when folks reapply, are they eligible for the same rate for all four years? I’m not sure which loan this question is about.

Eddy: Yeah, that’s an important clarification. So for the, um, f- on the federal side, the rate is the same.

Eddy: But one, one important clarification here, so I should… It, it’s, like, it’s, the rate is not the same over four years, I should specify. Last year’s Parent PLUS rate was 8.94%. This year, it’s 9.07%. So even the federal rate changes on an annual basis. Usually it’s not by a lot, but it does still change. So whatever that fixed rate is is gonna be the fixed rate for the entire academic calendar year, so the 2026-2027 academic year.

Eddy: Um, similarly for the Federal Direct Loan, it’s the same as the Parent PLUS. Last year it was 6.39%. This upcoming academic year it’s [01:30:00] 6.52%

Eddy: fixed for the full year. On the private side, uh, the rates will not be, um, fixed, uh, over four years. Uh, and so you can, you can… The rate that you apply for, if you choose the fixed rate option, will be fixed for the life of that loan. So if you… I’m just gonna say a 10-year loan at a 7.5% interest rate, you will stay at a 10-year loan, 7.5% interest rate for that specific loan.

Eddy: Maybe for freshman year of college. Then sophomore year of college, you reapply for a new loan. There’s no guarantee that you’ll get a 7.5% intru- interest rate loan. Hopefully you get a better rate. That’d be amazing, uh, and good news. Um, but there’s no guarantee that it’s gonna be the same across, across the board.

Anna: I think we’re down to our last question. Thank you so much [01:31:00] for all of your time on these, Eddy. Yeah. Do you have any suggestions of sites that offer scholarships that are legit?

Eddy: Good question here. Yeah, so a couple different ones. So, you know, we, I, I have frequently pointed to FastWeb, for example. Um, it has a large database of scholarships there.

Eddy: The, um, there’s other groups, for example, that we’re partnered with as well. I’m not sure, you know, I’m sure College Advisor has folks. Um, there’s specific scholarship groups o- on Facebook. A really big one that I’ve seen is How to Win Scholarships. Um, uh, Scholarships GPS is another big one that I’ve heard of.

Eddy: The other consideration about scholarships as well that I would encourage families to look at, uh, is local scholarships. Uh, to your local… Uh, look through your local library sources or even your s- high school, um, setting, ’cause [01:32:00] oftentimes a lot of local scholarships go unapplied for or under-utilized. And so yes, everyone wants to win that like $10,000 scholarship or the $50,000 scholarship.

Eddy: Those are amazing, and I’m not saying you shouldn’t apply to those. You absolutely should. But those are applications that have thousands of students. Uh, and so again, they’re highly competitive Many regional or local scholarships might have, like, two applicants. And so yeah, maybe it’s only $500 or $1,000, um, but your chances are much better as long as you put in an honest and earnest effort.

Eddy: I’m not saying you just, like, throw something together and just, you know, don’t try, but put in an honest effort into it. Um, and those are usually what I’ve… At least were, and I’ve heard from student, uh, student feedback. Those have much higher rates of success than, um, a lot of the ones. [01:33:00] I, I also wanna be careful, um, because there are, like…

Eddy: This- I think this can be a good thing, um, but also I’m interested to see how this impacts scholarship, uh, uh, scholarship administration, where there’s many agr- aggregator websites, and I’m sure, like, AI is entering the picture here, like auto apply to this and that. Um, I would encourage you to use it. Uh, I have no idea how many other students are using it.

Eddy: It’d be, it’d be curious to see, um, but how that impacts the, um, the disbursement of those funds. But I think about that in terms of, like, highest or, like, lowest hanging fruit, highest yield could be some of those ones that are, you know, $500 here, $500 there, $1,000 here, um, that might not be on any major scholarship website or an aggregator website or an AI compilator website.

Eddy: Um, but just requires [01:34:00] sort of m- maybe some good old, good old-fashioned, like, typing out a 500-word essay on your, on your computer and submitting that to an email address.

Anna: Yeah. I know those small scholarships really helped me out. They add up, and the, i- I had a much higher success rate with those than the, the big national ones for sure.

Anna: Um, Eddy, I think we made it through all of our questions. Thank you so much everyone for coming out to this webinar. Thank you to Eddy for your expertise. Uh, we’ll sign off. You’ll get an email with a recording of this. Take good care everyone.

Eddy: Good night. Bye.