VSAC Parent Loan Details 

A fixed-rate loan for parents helping to finance their student’s undergraduate or graduate education.

If you need help paying for your child’s undergraduate or graduate education, VSAC's Vermont Advantage Parent Loan may be a good option for you. This loan offers a fixed-interest rate as low as 4.79% APR, the option to cancel your loan if the unthinkable happens, and access to an Advantage Loan Coach for ongoing support and personalized counseling as you prepare for repayment.

Review the details in the tabs below and begin your application when you're ready. If you’d like to consider the option of cosigning your student’s loan, you may also want to learn about VSAC’s Vermont Advantage Student Loan.

Call 800-226-1029 to speak with one of our Vermont-based student financial aid experts. We're open Monday–Friday 8:00 am to 4:30 pm.

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VERMONT ADVANTAGE PARENT LOAN REPAYMENT OPTIONS

With VSAC's Vermont Advantage Parent Loan, you choose your interest rate, based on the repayment option that works best for you. You may not change your repayment option once you submit your loan application. After your interest rate is set, VSAC cannot alter your loan terms.

Vermont Advantage Parent Loan

Less expensive option

More expensive option

Immediate: Start principal and interest payments right away

  • Fixed interest rate of 4.79% (APR of 4.79% to 5.51%)
     
  • First monthly payment due within 45 days of the final disbursement to the school
     
  • Less expensive option over the life of the loan (lowest interest rate and you begin paying back principal sooner)

Delayed: Begin repayment 12 months after loan is fully disbursed

  • Fixed interest rate of 6.70% (APR of 6.66% to 7.33%)
     
  • First monthly payment due within 12 months plus 46 days of the final disbursement to the school
     
  • More expensive option over the life of the loan

 

 

LOAN REPAYMENT TERMS

  • The length of the repayment 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 (it is "capitalized") when the loan enters repayment.
  • Up to 24 months of hardship forbearance is available as determined at VSAC’s discretion. 
  • Repayment periods cannot be extended beyond the original term.
  • Loan debt is canceled completely if the parent or student dies or becomes totally and permanently disabled.

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VERMONT ADVANTAGE PARENT LOAN ELIGIBILITY

To apply for the Vermont Advantage Parent Loan…
The parent borrower must be:

  • The biological, adoptive, or step-parent of the undergraduate or graduate student
  • Able to meet VSAC credit requirements

and:

  • A U.S. citizen or eligible non-citizen
  • Not in default on an education loan

The student must be:

  • A Vermont resident, or
  • From another state attending college in Vermont

and:

  • Enrolled at least half time at an eligible postsecondary school
  • A U.S. citizen or eligible non-citizen
  • Eligible for federal student aid. The student must file a FAFSA (Free Application for Federal Student Aid). 

Ready to apply?

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VERMONT ADVANTAGE PARENT LOAN AMOUNTS

With the Vermont Advantage Parent Loan, you choose the amount you want to borrow for each academic year. Your student’s school will certify eligibility for the loan amount and schedule disbursements based on your student’s enrollment period.

  • Minimum loan amount: $500
  • Maximum loan amount: Up to the cost of your student’s education, minus any other aid, as determined by your financial aid office

Applying for financing for the full academic year has benefits:

  • Saves you time
  • Reduces paperwork and correspondence
  • Prevents delays in your subsequent disbursements
  • Minimizes credit bureau inquiries

Tip: Be sure to keep track of the loans you are taking out as you go along, especially if you choose to postpone payments. Remember: 4 years add up quickly.  

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MONTHLY & LIFETIME LOAN PAYMENTS

The amount you’ll pay each month—and over the life of the loan—will vary based on your credit history and the repayment option you choose (which determines your interest rate) as well as the amount of your loan. The rate is fixed for the life of the loan and will not vary according to market conditions.

To give you an idea of monthly—and lifetime—payments, here are examples of interest rates, fees, and APR for a $10,000 Vermont Advantage Parent Loan for the 2019–2020 school year. 

Repayment Option*

Interest Rate

Fee

APR

Finance Charge

Monthly Payments

Total Amount Paid

Principal and Interest Payments with:

Excellent Credit

4.79%

0%

4.79%

$4,149.80

180 @ $78.61

$14,149.80

Better Credit

3%

5.23%

$4,574.60

180 @ $80.97

$14,574.60

Good Credit

5%

5.51%

$4,857.20

180 @ $82.54

$14,857.20

Delayed Payments for 12 months with:

Excellent Credit

6.70%

0%

6.66%

$7,121.60

180 @ $95.12

$17,121.60

Better Credit

3%

7.06%

$7,636.40

180 @ $97.98

$17,636.40

Good Credit

5%

7.33%

$7,978.40

180 @ $99.88

$17,978.40

 

REPAYMENT ASSUMPTIONS

  • An origination fee, when applicable, is added to each loan disbursement.
  • 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 $5,000 plus an origination fee, when applicable, in September and in January and outstanding interest is capitalized at the final disbursement for the immediate repayment option. For the delayed payment option, repayment begins 12 months from the final disbursement and interest is capitalized.
  • All payments are made on time. Examples are estimates.

* Each repayment option is subject to funds availability. Funds will be awarded on a first-come, first-served basis. Interest rates for delayed repayment 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.

Ready to apply?

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COMPARE VSAC LOANS WITH FEDERAL PLUS

Both the Vermont Advantage Student Loan and the Vermont Advantage Parent Loan have a fixed interest rate lower than the federal Direct PLUS loan and may be a better financing option, depending on your situation.

 

VSAC’s Vermont Advantage Student Loan

VSAC’s Vermont Advantage Parent Loan

Federal Direct PLUS

What are the payment options?

Your choice of 3 payment options:

1. Immediate: Start principal and interest payments once loan is fully disbursed

2. Interest only: Make monthly interest payments while enrolled

3. Deferred: Begin paying after enrollment ends

Your choice of 2 payment options:

1. Immediate: Start principal and interest payments right away

2. Delayed: Begin paying 12 months after loan is fully disbursed

 

 

Your choice of 2 payment options:

1. Deferred (for student borrowers) and can be requested by parent borrowers: Begin paying 6 months after you graduate, leave school, or drop below half-time enrollment

2. Immediate (for parent borrowers): Start principal and interest payments once loan is fully disbursed; may request a 6-month deferral once your child leaves school

 

What are the interest rates?

 

Interest rate depends on your chosen payment option:

1. Immediate: 4.79% fixed (APR of 4.79% to 5.51%)

2. Interest only: 5.89% fixed (APR of 5.89% to 6.47%)

3. Deferred: 6.90% fixed (APR of 6.65% to 7.15%)

Interest rate depends on your chosen payment option:

1. Immediate: 4.79% fixed (APR of 4.79% to 5.51%)

2. Delayed: 6.70% fixed (APR of 6.66% to 7.33%)

 

 

Interest rate:

 

7.08% fixed for loans taken out between July 1, 2019, and June 30, 2020

The federal government does not provide APR information.

 

 

 

Is the interest rate fixed (the same) over the life of loan?

Yes

Yes

Yes

Is there an origination fee?

For some borrowers (one-time fee is 0–5% based on cosigner’s credit)

For some borrowers (one-time fee is 0–5% based on parent borrower’s credit)

Yes (one-time fee of 4.248% for loans disbursed by September 30, 2019)

May interest be tax deductible?

Yes

Yes

Yes

Whose name is on the loan?

Student and cosigner

Parent borrower

Parent on a Parent PLUS or student on a Graduate PLUS

Is there flexibility during repayment?

Yes (temporary postponements available for financial hardship at VSAC’s discretion)

Yes (postponements available for economic hardship, unemployment, or other situations)

All loans: Interest continues to accrue when payments postponed

Will the loan be cancelled in case of death or total and permanent disability?

Yes

[Note: if cosigner dies, cosigner is removed from loan, which remains in student name]

Yes

 

 

 

Yes

 

 

 

Who do I contact if I need additional help?

Contact your Vermont Advantage Loan Coach at 800-226-1029 (Monday–Friday, 8:00 am to 4:30 pm)

Contact your Vermont Advantage Loan Coach at 800-226-1029 (Monday–Friday, 8:00 am to 4:30 pm)

Call 1-800-433-3243 or visit StudentAid.ed.gov.  

 

The Bottom Line: When comparing to the PLUS loan, your lowest-cost option may be a VSAC Student Loan or Parent Loan.

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Example: A $9,000 loan (disbursed to school) with a 10-year repayment. The total amount paid will vary, depending upon when repayment starts. These examples compare the federal PLUS with 4.248% fees to the VSAC Immediate Repayment loan with two different fees of 0% and 3%.
  VSAC Immediate Repay Federal PLUS
Interest Rate

VSAC interest rates are determined by the repayment option selected. All 3 scenarios are fixed rate loans, meaning the interest rate will never change during the life of the loan. VSAC offers three repayment options. Compare the repayment choices.

 4.79% APR 4.79% APR 7.08%
Fees

The origination fee is a fee charged to make the loan. VSAC fees range from 0%–5% of the approved loan amount and is added to the loan principal. VSAC determines fees based on credit ratings. Federal PLUS has a standard fee for all loans.

 0% 3% 4.248%

Loan Amount (includes fees)

Total Principal includes the requested loan amount, fees, and any outstanding interest that may have accrued between disbursements.

 $9,000.00 $9,270.00 $9,399.28

Monthly Payment

The monthly payment is based on paying for 10 consecutive years. Periods of deferment or forbearance can affect your monthly payment.

 $96.00 $99.00 $112.00

Total Principal (Includes interest over between disbursements)

This example assumes 10 years to repay the loan. Different lenders have different repayment terms. Less interest accrues with a shorter repayment. VSAC sets up loans $10,000 and greater with a 15-year term. You can always pay extra in each monthly payment to pay off the loan sooner without penalty and further reduce the interest you'll pay.

 $9,090.29 $9,363.00 $9,538.66
Interest over 10 years $2,349.20 $2,415.65 $3,749.86

Total Paid with interest

Add the estimated interest to the loan amount to get the total paid with interest. This example assumes 120 consecutive payments to pay off the loan.

 $11,439.49 $11,778.65 $13,288.52
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