Tuition payment plans offer a smart way to tackle college costs. With rising concerns over affordability and student loan debt, families are increasingly looking for ways to better manage these expenses.
What Is a Tuition Payment Plan?
Tuition payment plans offer a convenient option for managing college fees by allowing students and families to spread costs over time. Lasting up to a year, these plans are an excellent alternative to loans, easing the financial burden by breaking bills into equal monthly or academic term payments. Families can pay for college out of pocket without interest, typically only incurring a low fee of $100-$200. These plans cover direct costs like tuition, fees, and sometimes housing and meal plans. Most plans also allow automatic bank transfers for timely payments.
Alternative to Federal Student Loans
Tuition installment plans are a less-expensive alternative to federal or private student loans, or incurring long-term debt in general. This is because there are no interest charges and installments are paid over a period of 12 months or less instead of a lengthy repayment period. And unlike loans, most tuition payment plans do not require a credit check.
Here’s an example of what a tuition payment plan might look like:
$12,600 tuition bill
9 monthly installment payments of $1,400 each
Add a $100 enrollment fee for a total amount paid of $12,700
This table compares the cost of a tuition installment plan with a Parent PLUS loan, assuming that the fees for both are paid up-front. Using a tuition installment plan saves the family approximately $5,000 in interest and fees.
| Short-Term vs. Long-Term Financing | Tuition Payment Plan | Parent PLUS Loan |
|---|---|---|
| Amount Financed | $12,600 | $12,600 |
| Interest Rate | N/A | 7.6% |
| Fees | $100 | $531.26 (4.264%) |
| Repayment Term | 9 months | 10 years |
| Monthly Payment | $1,400 | $157 |
| Total Payments | $12,700 | $18,786 |
| Total Payments (First Year) | $12,700 | $1,884 |
Tuition payment plans are especially popular among middle and high-income families at higher-cost colleges. These plans are also helpful for families of all income levels who want to better manage their monthly cash-flow (budgets).
Tuition Installment Plan Providers
Students and parents can sign up for a tuition payment plan through the bursar’s office, cashier’s office or the college financial aid office. Each college typically contracts with only one tuition installment plan provider. Some colleges manage their own monthly payment plan.
The most popular providers of tuition installment plans include:
- ECSI Tuition Payment Plan (TPP)
- FACTS Tuition Management – Acquired by Nelnet in 2005
- Tuition Management Systems (TMS) – Acquired by First Marblehead in 2010
- University Accounting Service (UAS) – A subsidiary of NCO
Apply for a Sallie Mae Private Student Loan
- Choose the #1 Private Student Loan Lender in the Nation. Sallie Mae is trusted by more families than any other private student loan lender.
- Variable Rates: 5.04% APR - 15.21% APR. Fixed Rates: 3.49% APR - 15.49% APR. Lowest rates shown include 0.25 percentage point interest rate discount with auto debit payments.1
- Applying online is easy - you could receive a credit result in about 10 minutes.2
- Multiple repayment options from in-school payments to deferred.1 No origination fee or prepayment penalty2
- Last year, students were 4x more likely to be approved with a cosigner3 and it may help you get a better rate.
- Borrow up to 100% of school-certified expenses, whether you're online or on campus4
Borrow Responsibly
We encourage students and families to start with savings, grants, scholarships, and federal student loans to pay for college. Evaluate all anticipated monthly loan payments, and how much the student expects to earn in the future, before considering a private student loan.
Loans for Undergraduate & Career Training Students are not intended for graduate students and are subject to credit approval, identity verification, signed loan documents, and school certification. Student must attend a participating school. Student or cosigner must meet the age of majority in their state of residence. Students who are not U.S. citizens or U.S. permanent residents must reside in the U.S., attend school in the U.S., apply with a creditworthy cosigner (who must be a U.S. citizen or U.S. permanent resident), and provide an unexpired government-issued photo ID. Requested loan amount must be at least $1,000.
1Advertised APRs for undergraduate students assume a $10,000 loan to a student who attends school for 4 years and has no prior Sallie Mae-serviced loans. Interest rates for variable rate loans may increase or decrease over the life of the loan based on changes to the 30-day Average Secured Overnight Financing Rate (SOFR) rounded up to the nearest one-eighth of one percent. Advertised variable rates are the starting range of rates and may vary outside of that range over the life of the loan. Interest is charged starting when funds are sent to the school. With the Fixed and Deferred Repayment Options, the interest rate is higher than with the Interest Repayment Option and Unpaid Interest is added to the loan’s Current Principal at the end of the grace/separation period. To receive a 0.25 percentage point interest rate discount, the borrower or cosigner must enroll in auto debit through Sallie Mae. The discount applies only during active repayment for as long as the Current Amount Due or Designated Amount is successfully withdrawn from the authorized bank account each month. It may be suspended during forbearance or deferment.
2Although we do not charge a penalty or fee if you prepay your loan, any prepayment will be applied as outlined in your promissory note-first to Unpaid Fees and costs, then to Unpaid Interest, and then to Current Principal.
3Based on a comparison of the percentage of students who were approved with a cosigner to the percentage of students who were approved without a cosigner from October 1, 2022 to September 30, 2023.
4For applications submitted directly to Sallie Mae, loan amount cannot exceed the cost of attendance less financial aid received, as certified by the school. Applications submitted to Sallie Mae through a partner website will be subject to a lower maximum loan request amount. Miscellaneous personal expenses (such as a laptop) may be included in the cost of attendance for students enrolled at least half-time.
Information advertised valid as of 10/25/2024.
SALLIE MAE RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS, SERVICES, AND BENEFITS AT ANY TIME WITHOUT NOTICE. CHECK SALLIEMAE.COM FOR THE MOST UP-TO-DATE PRODUCT INFORMATION.
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Edvisors is not the creditor for these loans and is compensated by Sallie Mae for the referral of Sallie Mae loan customers.
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Apply for a College Ave Private Student Loan
- Competitive APRs starting at 3.59%1
- Coverage up to 100% of your school-certified cost of attendance ($1,000 minimum) 2
- Multiple repayment options including: full principal and interest, interest-only, deferred, and flat payment
- Flexible payment terms ranging from 5, 8, 10, and 15 years3
- No origination, application and processing fees, no fees for early repayment
- Apply online in 3 minutes and get an instant credit decision
- Applying with a cosigner can increase your chances of getting approved and could result in a lower interest rate
College Ave's student loan products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
1All rates include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. If a payment is returned, you will lose this benefit. Variable rates may increase after consummation.
2As certified by your school and less any other financial aid you might receive. Minimum $1,000.
3This informational repayment example uses typical loan terms for a freshman borrower who selects the Flat Repayment Option with an 8-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 7.78% fixed Annual Percentage Rate (“APR”): 54 monthly payments of $25 while in school, followed by 96 monthly payments of $176.21 while in the repayment period, for a total amount of payments of $18,266.38. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
Information advertised valid as of 11/01/2024. Variable interest rates may increase after consummation. Approved interest rate will depend on creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of the Flat Repayment Option with the shortest available loan term.
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