Charter One Affordable PLUS Loan Repayment Examples
Program
Loan Amount
Interest Rate
Monthly Principal & Interest
Repayment Term (months)
Total Finance Charge
Payment
Postponement
$20,000
7. 25%1
$235
120
$8,176.24
48 months
Affordable PLUS Loan
1 The current fixed rate is 8.50%. With Charter One benefits the rate is 7.25% (1.00% interest rate reduction immediately after first disbursement and 0.25% interest rate reduction for automatic payment deduction).
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Home Equity Repayment Examples
Program
Loan Amount
APR
Monthly Principal & Interest
Repayment Term (months)
Total Finance Charge
Deferment
Home Equity Loan
$20,000
6.89%
$231.08
120
$7,731
N/A
Home Equity Loan
$20,000
7.00%
$155.06
240
$17, 215
N/A
2
2 APR as of 5/07/07. 6.89% APR is available for qualifying properties in PA, NJ, DE, MA, RI, CT with a loan-to-value (LTV) of 85% or less for loans of $20,000 or more, auto-deduction from Circle Checking and a 10-year term. An equity
loan of $20,000 with a 10-year term at 6.89% results in 120 monthly payments of $231.08. 7.00% APR available for qualifying properties in PA, NJ, DE, MA, RI, CT, NH, VT with a loan-to-value (LTV) of 85% or less for loans of $20,000
or more, auto-deduction from Circle Checking and a 20-year term. An equity loan of $20,000 with a 20-year term at 7.00% results in 240 monthly payments of $155.06. Other rates and terms available. Rates may vary by state, property
type, loan amount and loan-to-value ratio. 1- to 4-family owner-occupied properties only. Not available for homes currently for sale or intended to be sold within six months of closing. Property insurance required. Flood insurance may be
required. All accounts and services subject to individual approval. See a banker for details.
Equal Housing Lender.
Alternative Loan Repayment Examples
Charter One Undergraduate Loan: $20,000 for 20 years (Based on the LIBOR Index)3
Program
Loan Amount at
Repayment4
APR5
Monthly Principal & Interest Payment
(after deferral period, if any)6
Repayment Term
(months)
Total Finance
Charge7
Deferment Period
Option 1: Immediate Repayment
$20,000
8.12%
$168.78
240 months
$20,507.20
N/A
Option 2: Interest-Only Repayment
$20,000
8.12%
$168.78
240 months
$27, 003.04
Interest: 0 months
Principal: 48 months
Option 3: Deferred Repayment
$20,000
7.93%
$228.23
240 months
$34,775.20
48 months
3 This repayment example assumes the variable interest rate for the Charter One Undergraduate Loan is equal to the LIBOR Index plus a margin of 2.80% for repayment options 1 & 2 and 2.99% for option 3. The interest rates used in
this example and in effect as of 04/01/2007 are 8.12% for Options 1 & 2 and 8.31% for Option 3. The interest rate margin ranges from 2.80% to 5.45% (APRs range from 7.93% to 12.06%), depending on the credit-worthiness of the
borrower and co-signer, if any, and the repayment option selected. The LIBOR Index is equal to the average of the one-month LIBOR rates as published in the “Money Rates” section of the Wall Street Journal on the first business day
of each of the three (3) calendar months immediately preceding each quarterly adjustment date. LIBOR means the London Interbank Offered Rate. The interest rate and APR will increase during the life of the loan if the LIBOR Index
increases. The loan terms described are for the 2007-2008 academic year and are subject to change. These repayment examples assume origination fees of 0.0% of the total loan amount (the requested loan amount plus the origination
fee) for Options 1 & 2, and 0.0% of the total loan amount for Option 3. The origination fee ranges from 0.0% to 9.5%, depending on the repayment option selected and the credit-worthiness of the borrower and co-signer, if any. The
origination fee, if any, will be added to and financed with the requested loan amount at disbursement.
4 Loan amount at repayment is the principal amount of the loan at disbursement ($20,000 for options 1, 2, and 3) plus, if you elect to defer repayment, interest that accrues during the deferment term (which is assumed to be 48 months)
under repayment Option 3, where both interest and principal is deferred. Under repayment Option 3, deferred interest is capitalized (added to principal) at the time your loan enters repayment.
5 Annual Percentage Rate (APR) is a measure of what a loan will cost. It takes into account the rate, fees, length of the loan, and the timing of all payments.
6 Monthly payments of principal and interest under Option 1 will be computed based on the interest rate applicable at the time repayment begins. Monthly payments of principal and interest will be fixed for the first year and then
recalculated once each year based on the interest rate applicable at the time of the calculation and reset on the anniversary of your most recent repayment start date so as to pay the loan in full over the remaining repayment period.
Monthly payments of principal and interest under Options 2 & 3 will be fixed for the first year when the loan goes into repayment and then recalculated once each year based on the interest rate applicable at the time of the calculation
and reset on the anniversary of your most recent repayment start date so as to pay the loan in full over the remaining repayment period. If principal or principal and interest is deferred, the monthly payment amount shown here will
increase if the interest rate increases, and will be computed based on the interest rate applicable at the time repayment begins. Minimum monthly payments will be at least $25. For option 2 (under which the student elects to defer
principal and make interest-only payments while in school) the monthly payment while in school would be $129.83. This monthly payment will increase if the interest rate increases.
7 Finance charge is interest paid over the life of the loan, plus the origination fee, if any.
Signature Student Loan®
Interest Rate & Fees
Monthly Payment Amount
APR
Total Finance Charge
$237
6.60%
$20,425
Prime minus 1.00%, no fees8
Prime plus 2.00%, 3.00% repayment fee
$319
9.86%
$37,300
Prime plus 6.50%, 3.00% repayment fee
$456
13.67%
$62,137
8 Includes a 0.50% interest rate reduction for auto debit, which is a borrower savings of $2,168.
Assumes a $20,000 loan, 45 months in school, 6 months grace and a 15 year repayment term. Assumes a constant Prime Rate of 8.25% which was the published rate in The Wall Street Journal as of May 11, 2007.
Interest rates and fees are based on credit history and the school being attended.
When comparing the loan options above, please be sure to look at the variables. These loans are not all based on the same repayment terms.
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COHEALTPL07 2.5K 06/07
Comparing PLUS, Home Equity,
and Alternative Loans
Charter One recognizes that every situation is unique.
We compiled this comparison chart to help you fully understand your education financing choices. For a detailed repayment comparison to see how the same $20,000 borrowed translates into
each option, please see the reverse side. The bottom line is to find the solution that best works for your family.
Feature
Federal PLUS Loan
Home Equity Loan
Alternative Loan
Borrower Eligibility
• P
arents of all income and asset levels, with dependent,
undergraduate students are eligible.
• Graduate students eligible.
• H
omeowners within our markets may apply for a Home
Equity Loan.
• E
nables the student to share in the borrowing
responsibility and develop a credit history.
• International students are eligible to apply with a
qualified U.S. co-signer.
Loan Payments
and Term
• T
ypically, a shorter repayment term means less finance
charges over the life of the loan.
• M
onthly payments for 10-year loans are comparable
to the PLUS Loan. Monthly payments for longer term
loans may be lower, however, finance charges over the
life of the loan may be greater.
• T
ypically, a longer repayment term means smaller
monthly loan payments, although finance charges over
the life of the loan may be greater.
Payment Insurance
• P
LUS Loans are federally guaranteed and are
discharged in the event of total and permanent
disability or death.
• P
ayment insurance is not available for Home
Equity Loans.
• N
ot federally insured and offers no discharge in the
event of disability or death.
Interest Rate and
Rate Caps
• B
orrowers are eligible for a fixed interest rate of
7.25%1. (The rate before the borrower benefits
listed below is 8.50%.)
• Zero default (guarantee) fee.
• 1.00% interest rate reduction immediately after
first disbursement.
• 0.25% rate reduction for automatic payment
deduction.
• Interest rate is fixed when you apply.
• Competitive, variable interest rate.
Approval Criteria
• A
pproval is based only on the borrower’s credit history.
Borrowers must pass annual credit check.
• A
pproval is based on several factors including credit
history, debt-to-income ratio and equity in your home.
• A
pproval is based on several factors including
credit-history.
Applying for a Loan
• T
he PLUS Loan Master Promissory Note is good
for 10 years, you do not need to complete
paperwork annually.
• Must apply for each loan.
• Must re-apply each year for additional funds.
Payment Deferment Situations
• P
LUS offers unemployment and economic
hardship deferments.
• N
o deferment during unemployment or
economic hardships.
• A
lternative Loans offers both interest-only and
full deferments.
• At the lenders discretion unemployment and
economic hardship deferments are available.
Payment Flexibility
• Income-sensitive, graduated and extended repayment
options are available.
• P
ayment amount is fixed. Borrowers have flexibility in
choosing a repayment method including auto deduction
from Charter One Checking or paying by check.
• Several repayment options available.
Borrowing Limits
• N
o loan limit—borrowers may borrow up to the cost of
education less any other financial aid awarded.
• A
mount borrowed is limited only by the amount of
equity in applicant’s home, debt-to-income ratio,
and credit-worthiness.
• M
ost alternative loans enable borrowers to borrow
up to the full cost of education less any other financial
aid awarded.
Tax Benefits
• Potential tax benefits - ask your tax advisor for details.
• Potential tax benefits - ask your tax advisor for details.
• Potential tax benefits - ask your tax advisor for details.
Prepayment Penalty
• No prepayment penalty.
• Prepayment penalty may apply. See banker for details.
• No prepayment penalty.
See reverse side for repayment examples. Call 1-800-721-3969 or visit charterone.com/edu for more information.
1 For academic year 2007-08, Charter One will subsidize the default (guarantee) fee (if the guarantor used is charging a fee) on our Affordable PLUS Loan. Charter One reserves the right to modify or discontinue these benefits in future academic years. Changes to these benefits, if any, will affect only loans taken after the changes
occur. Charter One offers these rate reductions during all repayment, deferment and forbearance periods as long as the borrower maintains on-time payments. Interest does accrue during periods of deferment and forbearance.
This work incorporates copyrighted materials owned by The Education resources institute, Inc.
*Photos shot at Babson College, Wellesley, MA