Company founder, Craig Price, is a career financial planner who frequently advises parents on saving for their children’s college education. For his own three children, all of whom attended Notre Dame, he got a late start on saving for college. To fund the out-of-pocket cost of Notre Dame, Craig necessarily became acquainted with Federal student loans and Parent PLUS loans. His oldest daughter went on to complete a Master’s degree at Vanderbilt, so the Price family learned first-hand about Graduate PLUS loans.

The Reality of High-Cost, High-Fee Loans

Even though Craig had a high credit score, and high enough income that his kids didn’t qualify for much scholarship, he was stunned to pay over 7.0% interest borrowing through the Federal Parent PLUS loan program.

To add insult to the high 7% rate, the Parent PLUS loan charged over 4.25% as an origination fee. The unsubsidized Graduate PLUS loans taken out by his daughter were just as high-interest, and high-fee for origination.

Drawing on his career advising investors, Price felt there had to be a better way. Creditworthy parents like Price or advanced degree-holders like his daughter could otherwise borrow privately in the 3.5-5.0% range, but not for Student Loans. For parents with PLUS loans and graduate students with PLUS loans, there is a staggering $171 billion of loans outstanding with interest rates of 6.2%-7.9% in the last 10 years. Every academic year, new high-rate, high-fee PLUS loans exceeding $15 billion are taken out.

Impact Capital Funds changes the status quo of high-rate, high-fee loans by lowering the borrowing rate to 3%-5.7% for responsible, creditworthy graduates and their parents.
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