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There are many constraints for students taking out Federal
loans, making our Tuition Options Program (TOP) very
attractive. This private student loan , which is a DTC model,
allows the student along with an eligible cosigner to receive
loan funds for the remaining cost of education that the Federal
loan does not cover. Plus unlike the PLUS loan it can be
deferred until 6 months after the student graduates. The
maximum loan amount for student loans through the Federal
program has not changed since 1998, while tuition cost continue
to rise every year. The TOP loan has been a great success for
students looking for optional financing.
In 2004 we disbursed $17 million through the program, and
increased to $22 million for 2005. This represents 22% of our
education loan business for 2005. When we started offering the
TOP loan in 2003, private loans nationwide were representing
about 6% of lenders education loan volume. With cost of
education continuing to rise and Federal loan amounts remaining
low, it is predicted private loan volume will only continue to
grow. If a member comes to us for a private loan, they will
learn through counseling or NFO, that we also have a Federal
program , presenting us with a cross selling opportunity.
