Education Loan for Parents and Families

Choosing to apply for either a private parent loan or the parent PLUS loan is a personal decision. The PLUS loan has some but not all the repayment benefits of federal loans for students. It has one interest rate for all applicants and includes an up-front fee of more than 4%. Rates for private loans, like the College Family Loan, are based on your credit and typically do not have an upfront fee. In addition, lenders offer their own repayment benefits, which may be as generous as what parent PLUS loans allow. It's important to understand the differences before deciding which is best for your circumstances.

Compare the Illinois College Family Loan to the PLUS loan now (PDF).

No. Students cannot apply for or cosign an application for the Illinois College Family Loan. The student has no obligation to repay this loan, and it is not transferrable to the student after he or she leaves school.

To be eligible for this private student loan program, you must:

• Not have defaulted on any private or government student loan.
• Not have an active bankruptcy case.
• Be a U.S. citizen or permanent resident residing in Illinois. Cosigners must be U.S. citizens or permanent residents residing in the United States. Military addresses are considered U.S. addresses if designated as an APO or FPO.
• Be of majority age pursuant to Illinois law at the time of application.

The student for whom the funds are being requested must:

• Be a U.S. citizen or permanent resident residing in Illinois.
• Be attending any nonprofit, Title IV eligible, degree-granting, accredited Illinois college or university.
• Be accepted, enrolled or attending on at least a half-time basis, as defined by the school, and be making satisfactory academic progress in an eligible education program.
• Complete a Student Authorization Form.

The College Family Loan is for borrowers and one or more creditworthy cosigners.

To qualify, you or your cosigners must have:

• Monthly payments for approved credit (mortgages, rent, car loans, credit cards and other forms of credit, including this loan application) that do not exceed 40% of gross monthly income (if a mortgage or rent is not included, debt-to-income ratio cannot exceed 25%). All student loan debt will be treated as though it is in repayment.
• Continuous employment over the last two years. (This requirement may be waived for retirees, disabled persons or those receiving a verified income.)
• A FICO score of at least 660. (The FICO score used is the TransUnion FICO Score 8, which is based on data from TransUnion and may be different from other credit scores. FICO is a registered trademark of the Fair Isaac Corporation.)
• No more than two accounts reporting 30-day delinquencies and no delinquencies of 60 days or more during the previous two years.
• No charge-offs, repossessions, collection accounts, judgments, foreclosures, garnishments by credit providers or tax liens.
• No previous bankruptcies.
• Not defaulted on any private or government student loan.

Note: For joint cosigned Illinois College Family Loans, at least one cosigner must meet all credit underwriting criteria with the exception of the debt-to-income ratio, which the cosigners may combine debt and income to calculate the debt-to-income ratio. For loans with only one cosigner, either the applicant or cosigner must meet all credit underwriting criteria with the exception of the debt-to-income ratio, which the applicant and cosigner may combine debt and income to calculate the debt-to-income ratio.

The list of criteria above may not be exhaustive. ISL Education Lending may require you or your cosigners to meet additional criteria in order to qualify for a loan. ISL Education Lending reserves the right to change the list of criteria in any way from time to time.

You may borrow up to your student's cost of attendance minus other aid each year. Your student's college or university must certify that the amount you are requesting does not exceed this amount.

Use the student loan payment calculator to estimate how much your monthly loan payment will be once you start repayment.

No; interest-only payments cannot be made using our auto-debit system. This is because the interest amount due each month is not a set amount and will change based on when your payment is received and the difference in the number of days in each month.

You may use auto-debit once principal and interest repayment begins, which is typically after your student has left school.

You can earn a 0.25% interest rate reduction by signing up to have principal and interest payments automatically withdrawn. The 0.25% interest rate reduction will apply once payments begin to be automatically deducted. The reduction will remain in effect as long as automatic payments continue without interruption during the repayment period. The 0.25% interest rate reduction will not lower the monthly payment amount but will instead reduce the interest amount that accrues. The interest rate reduction will be suspended during approved assistance or if automatic payments are rejected due to insufficient funds.

Interest that is not paid during deferments or under other circumstances is capitalized (or added to the principal balance of the loan). Interest on the Illinois College Family Loan capitalizes at:

• The end of any qualifying deferment period for all loan options.
• The start of repayment status for loans that do not require principal and interest or interest-only payments while the student is enrolled and during the separation period.
• The final disbursement of loans that require monthly principal and interest payments while the student is enrolled in school and that have more than one disbursement.

There are no origination, prepayment, late or other fees associated with this loan.

If you are approved for a loan, the rate offered will depend on the credit used (yours or your cosigner's, if applicable) and the term you select. Pre-qualify, with no impact to your credit score, to learn your rate.

You may qualify for assistance based on your situation. Please call us as soon as possible if you experience issues, so we can help you avoid delinquency.

In the unfortunate event of a borrower's death or qualifying total and permanent disability, Iowa Student Loan Liquidity Corporation will forgive the loan and not require cosigners or the borrower's estate to satisfy the loan obligation. Iowa Student Loan Liquidity Corporation will also forgive the loan and not require the borrower or cosigners to satisfy the loan obligation if the student, for whom the loan funds were borrowed, dies or suffers a qualifying total and permanent disability.

A tax professional or the IRS can provide additional information about possible tax consequences of loan forgiveness.

No; in the event of a cosigner's death or qualifying total and permanent disability, you will not be required to find a new cosigner for an existing loan. In addition, if a cosigner suffers a qualifying total and permanent disability, Iowa Student Loan Liquidity Corporation will release the cosigner from his or her obligation.

Capital for private loans available through the Illinois College Family Loan is provided by the Office of the Illinois State Treasurer. The private loans are serviced by Aspire Servicing Center.