VSAC fixed-rate private education loan for the 2010–2011 academic year: the Vermont Advantage
Need additional financing? VSAC can help.
VSAC is pleased to offer the Vermont Advantage loan for 2010–2011.
The application for the Vermont Advantage loan is now available. Go to the application and instructions.
The Vermont Advantage loan has:
- a fixed interest rate of:
- (a) 6.90% if you choose to begin principal and interest payments while enrolled;
- (b) 7.35% if you choose interest-only payments while enrolled; or
- (c) 7.75% if you choose deferred repayment while enrolled.
- a one-time origination fee of 0%, 3%, or 5%, based on the credit rating of the cosigner. No fee for those meeting VSAC’s “excellent" credit standards.
- cosigner release, available after 48 months of active repayment if the student borrower meets VSAC credit criteria.
A private education loan can help make up the difference between your total cost of education and the various kinds of financial aid you have received. Students should always start with the federal Stafford loan, and use a private student loan only after reaching the maximum in federal Stafford funding. Contact your school’s financial aid office if you haven’t already applied for a federal Stafford loan.
Compare the federal PLUS loan for parents to VSAC’s Vermont Advantage loan program.
Frequently Asked Questions about the Vermont Advantage loan process
GET THE FACTS
Eligibility
To be eligible for the Vermont Advantage loan, you must be a student who is:
- a Vermont resident attending college in or out of state, or
- a nonresident borrowing for attendance at a Vermont school
AND is:
- a U.S. citizen or eligible non-citizen
- applying with a credit-approved cosigner
- an undergraduate or graduate/professional student
- enrolled/enrolling at least half-time at an eligible postsecondary school
- eligible for federal financial aid
- not in default on a VSAC loan
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How to Apply
The application for the Vermont Advantage loan is now available. Go to the application and instructions.
If you’ve received a tuition bill from your school, contact the billing department and let them know that you intend to apply for the Vermont Advantage loan from VSAC.
Loan Amounts
Minimum: $200
Maximum: Up to the cost of your education, less any other aid, as determined by your financial aid office.
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Repayment Options
Borrowers have three options for repayment:
- Immediate repayment of principal and interest while the student is enrolled. The first monthly payment is due within 45 days of the final disbursement to the school. This is the least expensive option.
- Interest-only payments while the student is enrolled at least half-time. The first monthly payment of interest is due within 45 days of the final disbursement to the school.
- Deferred repayment while the student is enrolled at least half-time. The first monthly payment of principal and interest is due within 45 days after at least half-time enrollment ends. This is the most expensive option.
The borrower selects the desired repayment option on the loan application. The borrower may not change repayment options once the selection is made.
Repayment period (term):
- The length of the repayment term is determined by the loan amount:
- 10 years for loans up to $9,999
- 15 years for loans of $10,000 and above
- Payments are required monthly. There are no prepayment penalties.
- Any outstanding interest is added to the principal (capitalized) when the loan enters repayment.
- Repayment periods cannot be extended beyond the original term, other than through periods of approved hardship forbearance.
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INTEREST RATES & FEES
The interest rate is fixed for the life of the loan; the rate will not vary according to market conditions. This rate is determined by the repayment option selected by the borrower on the application.
- Immediate repayment: 6.90%
- Interest-only payments: 7.35%
- Deferred repayment: 7.75%
The one-time origination fee is deducted from the loan amount and is determined by the strength of the cosigner’s credit.
- cosigner meeting VSAC's excellent credit standards: 0% fee
- cosigner meeting VSAC's better credit standards: 3% fee
- cosigner meeting VSAC's good credit standards: 5% fee
Sample Repayment Option Comparison - Vermont Advantage loan for 10/11 academic year
Example for loan approved for $10,000 and 0% origination fee.
| Repayment option* | Interest rate | Estimated finance charge | Estimated payment schedule | When loan will be paid off (assuming 4 years of enrollment) | Estimated total amount paid |
| Immediate repayment | 6.90% | $6,263 | 180 payments of $90 starting while enrolled | 2026 | $16,263 |
| Interest-only payments while enrolled | 7.35% | $9,211 | 40 monthly interest-only payments of $62 while enrolled 180 payments of $93 |
2030 | $19,211 |
| Deferred repayment while enrolled | 7.75% | $11,533 | 40 months of no payments while enrolled 180 payments of $120 |
2030 | $21,533 |
Repayment assumptions:
- Loan repayment term is 180 months and begins when full payments are due (for loans approved for less than $10,000, the term is 120 months).
- Two equal disbursements of $5000.00, one in September and one in January, and outstanding interest is capitalized at the final disbursement. For the Interest-Only payment and Deferred-Repayment options, borrower is enrolled for 44 months.
- All payments are made on time.
* Each repayment option is subject to fund availability. Funds will be awarded on a first-come, first-served basis. The interest rates for deferred repayment and interest-only payment loans are higher than the interest rate on immediate repayment loans and result in a higher cost of borrowing. Interest begins accruing after each loan disbursement. Borrowers who enroll in the deferred repayment option may choose to make interest-only or regular payments during the in-school period. Loans made under the deferred repayment option will remain deferred as long as the student remains enrolled in at least half-time status at an eligible school. Borrowers who enroll in the immediate repayment option may not defer repayment, although short-term hardship forbearance may be available.
See full listing of fees and APR.
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Cosigner
VSAC requires a credit-eligible cosigner for all Vermont Advantage loans.
| A student applicant needs a cosigner to … |
Apply for a Vermont Advantage loan. |
| A cosigner … | Is a U.S. citizen or eligible non-citizen (frequently the student applicant’s parent or guardian) who is equally responsible for repaying the loan. |
| A cosigner with excellent credit will … |
Enable the student applicant to get a 0% fee loan. |
| A cosigner who is able to make payments while the student is enrolled will … | Enable the student applicant to get the lowest interest rate (6.90%). |
| Cosigner’s responsibilities are to … |
Make payments, including any late or collection fees if the student borrower is unable to pay. Sign all paperwork along with the student borrower. |
| As a cosigner, expect to … | Receive a bill statement for the loan each month along with the student borrower. Have the loan’s payment status reported to national credit bureaus for both the cosigner and the student borrower. |
| Once a cosigner, always a cosigner unless … | Cosigner release is available upon request to qualified student borrowers after 48 months of active repayment; the student borrower must meet VSAC’s credit criteria. |
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APR and Repayment Example - Vermont Advantage Loan for 10/11 school year
APR example for Loan Approved for $10,000
| Repayment Option* | Interest Rate | Fee | APR | Finance Charge | Monthly Interest-Only Payments | Monthly Full Payments |
| Principal & Interest Payments while enrolled with: | 6.90% | Total amount paid - $16,262.70 | ||||
| Excellent Credit | 0% | 6.90% | $6,262.70 | n/a | 179 @ $90.35 and 1 @ $90.05 | |
| Better Credit | 3% | 7.38% | $6,562.70 | n/a | 179 @ $90.35 and 1 @ $90.05 | |
| Good Credit | 5% | 7.71% | $6,762.70 | n/a | 179 @ $90.35 and 1 @ $90.05 | |
| Interest-Only Payments while enrolled with: | 7.35% | Total amount paid - $19,211.32 | ||||
| Excellent Credit | 0% | 7.35% | $9,211.32 | 40 @ $61.93 | 179 @ $92.98 and 1 @ $90.88 | |
| Better Credit | 3% | 7.73% | $9,511.32 | 40 @ $61.93 | 179 @ $92.98 and 1 @ $90.88 | |
| Good Credit | 5% | 8.00% | $9,711.32 | 40 @ $61.93 | 179 @ $92.98 and 1 @ $90.88 | |
| Deferred Payments while enrolled with: | 7.75% | Total amount paid - $21,532.38 | ||||
| Excellent Credit | 0% | 7.43% | $11,532.38 | n/a | 179 @ $119.63 and 1 @ $118.61 | |
| Better Credit | 3% | 7.75% | $11,832.38 | n/a | 179 @ $119.63 and 1 @ $118.61 | |
| Good Credit | 5% | 7.97% | $12,032.38 | n/a | 179 @ $119.63 and 1 @ $118.61 |
Repayment Assumptions:
- Origination fees, when applicable, are deducted from the loan disbursement(s).
- Loan repayment term is 180 months and begins when full payments are due (for loans approved for less than $10,000, the term is 120 months).
- Two equal disbursements of $5000.00, one in September and one in January, and outstanding interest is capitalized at the final disbursement. For Interest-Only Payment and Deferred Payment options, borrower is enrolled for 44 months.
- All payments are made on time.
* Each repayment option is subject to fund availability. Funds will be awarded on a first-come, first-served basis. Interest rates for Deferred Repayment and Interest-Only payment loans are higher than interest rates on immediate repayment loans and result in a higher cost of borrowing. Interest begins accruing after each loan disbursement. Borrowers who enroll in the deferred repayment option may choose to make interest-only or regular payments during the in school period. Loans made under the deferred repayment option will remain deferred as long as the student remains enrolled in at least half-time status at an eligible school.
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