in degree and credential
programs that will prepare them for careers as excellent classroom teachers.
- Golden Apple Scholars at various Illinois colleges and universities
These programs vary in cost
but none are inexpensive. It can be daunting for those choosing a less than lucrative career as a teacher to take on debt. If the only option for paying is the Department of Educations Plus Loan program, such high quality programs may seem out of reach.
An Income Sharing Agreement (ISA) from Education Equity, Inc. can be an attractive alternative for funding your career development. Compare $20,000 of funding from Department of Education Plus Loan program to $20,000 of ISA funding from EEI.
$20,000 of funding from the Plus Loan Program.
The nominal interest rate for Plus Loans will be 7.0 % starting July 1, 2017. The actual cost is higher. Each dollar borrowed with a Grad Plus Loan is subject to a 4.276% fee. This means you will actually receive only $95.72 for each $100.00 you are obligated to repay. After paying the 4.276% fee you will be left with $20,000 of funding if you borrow $20,893.40
In addition you are responsible for interest payments immediately, there is no grace period. You do not have to start paying immediately, but if you don’t the interest will accrue and be added to your loan. When you finish your program two years after you start you will have an additional $ 3,027.45 of accrued interest on your balance. To get $20,000 of funding you will be paying a loan of $23,920.85 The monthly payments will be $277.73 for ten years.
$20,000 of funding from an ISA
There are no fees and no interest to accrue and capitalize. If you enter into a $20,000.00 ISA you will get $20,000. You will payback 6.0 % of your income, that is between $25,000 and $100,000 per year. You do not pay any part of income that exceeds $100,000 and you don’t payback at all if the income is less than $25,000.
- If you earn $45,000.00 your payment will be $225.00
- If you earn $55,546.00 your payment will be $277.73
- If you earn $65,000.00 your monthly payment will be $325.00