Pennsylvania college students will have a new financial aid option this fall.
The Pennsylvania Higher Education Assistance Agency is getting back into the lending business with the launch of its Pennsylvania Forward student loan program.
PHEAA stopped funding student loans in 2010 when the Federal Family Education Loan program was phased out by Congress.
The agency says the new program, beginning in the 2019-2020 school year, is a low-cost alternative.
“It’s very competitive,” PHEAA spokesman Keith New said. “There are a lot of borrower benefits built in that they can’t enjoy elsewhere.”
Those benefits include no origination or late fees, a 0.25-percent interest rate reduction for automatic debit enrollment and a 0.50-percent interest rate reduction for graduating on time.
“Between the lack of fees and interest rates being lower and reductions they can enjoy in repayment, a borrower can save thousands of dollars in this loan,” New said.
Interest rates will be set in about two weeks, but New says they will be competitive. He said anyone struggling to afford college should take a look at the new program.
“Our goal isn’t to make money. We’re not the private sector,” he said. “Our goal is to make sure the borrower stays in good standing and has a worry-free repayment experience.”
Applications for the program will be available in the spring.