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Higher education is expensive, and the costs seem to grow exponentially each year. In the state of South Carolina, tuition can vary widely depending on the school and financial aid options available. There are a wide range of options for higher education in South Carolina, ranging from the historic College of Charleston to relatively small Columbia College to large public system of the University of South Carolina.
At the high end, private colleges like Furman University and Wofford College can cost upwards of $35,000 per year, while technical and community college tuition is typically under $5,000 per year for in-state students. Depending on where they decide to matriculate, the question for many South Carolina students quickly becomes how they will afford to attend the college or university of their dreams.
While federal student loans are often available, these programs may not cover the full cost of tuition. For the 2016-2017 academic year, federal student loans are limited to a maximum of $7,500 for dependent students and $12,500 for independent students. This amount often falls far short of the total cost of attending a college or university, which leaves students and their families looking for a way to pay the remaining tuition, fees, housing, and other educational expenses.
The South Carolina Student Loans Lender
For South Carolinians attending school anywhere in the United States and students who choose a school within South Carolina, the answer may lie with a statewide non-profit known for offering low interest private loans for students. South Carolina Student Loans (SCSL) is the only statewide non-profit educational lender.
Designated by the State of South Carolina, SCSL offers a number of student loan options to help students achieve their dreams of attending college or university. SCSL has been in operation since 1973. In more than 40 years of lending funds to South Carolina students, SCSL has become a trusted lender with one of the lowest rates, shown here, of student loan defaults in the country. It offers private loans to students who are either residents of South Carolina or non-residents who choose to go to school in South Carolina and state-funded loans for South Carolina residents who pursue a course of teacher education at any accredited school.
SCSL has a number of loan options available for either out-of-state students seeking to attend an accredited college or university in South Carolina or South Carolina residents looking to go to school outside of the state. SCSL is also the only entity within the state of South Carolina that can offer forgivable student loans specifically for teachers, which serves the dual purpose of expanding education throughout the state and helping students who want to become teachers.
This article explores the two primary loan types offered by SCSL, Palmetto Assistance Loans and South Carolina loans for teachers. Under the umbrella of loans for teachers, SCSL offers three separate programs: SC Teachers Loans, SC Career Changers Loans and SC Program for Alternative Certification for Educators (PACE) loans. Each of these loans offers numerous benefits for borrowers both inside and outside of South Carolina. Loans available for teachers have additional advantages for residents of South Carolina, as they promote improved education within the South Carolina public school system.
Palmetto Assistance Loans (PAL)
When it comes to financing higher education, one of the biggest challenges for students and their families is bridging the gap between financial aid, federal loans, and the actual cost of attending a college or university. For students in South Carolina as well as their parents, Palmetto Assistance Loans (PAL) may be the answer.
Because SCSL is a non-profit institution, it is able to offer private student loans to qualifying students with low, fixed interest rates through the PAL. Qualifying borrowers can obtain loans with no application or origination fees. For loans approved after August 9, 2016, the interest rate is just 4.99 percent for the life of the loan, with an annual percentage rate of 5.04 percent. If a student chooses to not pay interest payments while enrolled, the interest rate rises to 6.99 percent (with an annual percentage rate of 7.56 percent). Students who decide to not pay interest on their loans while enrolled must pay 25 dollars per month. Students can also reduce their interest rate by .25 percent by signing up for an automatic bank transfer. Whether the interest rate is 4.99 or 6.99 percent, it will not change for the duration of the loan, giving students the benefits of knowing exactly how much their student loan payments will be each month.
In order to qualify for the PAL, a student must be enrolled on at least a half-time basis at an eligible school, which includes public or not-for-profit colleges and universities within the United States that have been deemed eligible by the U.S. Department of Education. The only exception to this requirement for the PAL is the Charleston School of Law. The borrower must be either a resident of South Carolina attending any of these schools in the United States, or an out-of-state student attending an eligible school in South Carolina. Additional requirements include maintaining good academic standing, not being incarcerated, being creditworthy and being in good standing on other educational loans. Borrowers must either be a United States citizen or permanent resident to qualify for the PAL. Parents of students are also eligible to apply for the PAL, and may also serve as a co-signer on a student’s loan.
Because the PAL is a private loan, all borrowers under the age of 24 are required to have a co-signer. A co-signer is a person, typically a parent, guardian or other family member, who guarantees that if the borrower cannot pay back the loan, they will be legally responsible for the balance. Because they could potentially be liable for the full cost of the loan, a co-signer should carefully consider before agreeing to sign a student loan. While a co-signer does not bear primary responsibility for the loan, he or she will be on the hook if the borrower does not make payments on the loan. The requirement of having a co-signer is standard practice for private student loans for anyone under age 24 and/or who does not have a strong credit score. Note that co-signers cannot be released on SCSL’s student loans like many other lenders offer.
The PAL can be used for any number of educational expenses, including tuition, room and board, various school feees, a computer, supplies for school and even transportation to and from school. It is available in amounts ranging from $2,000 up to the full cost of attendance (less any other financial aid). A full list of The maximum amount that can be taken out is $100,000, including previous PAL loans. Once a loan is approved, the funds will sent directly to the school and then credited to the student’s account. For loans with balances of less than $17,500, the loan term is ten years. All other loans are on a fifteen year repayment term.
One of the more unique aspects of the PAL program is that it is not limited to South Carolina schools or even South Carolina residents. Any student — whether a resident of South Carolina or another state — can apply for a PAL if he or she is enrolled at an eligible South Carolina educational institution. For South Carolina residents, the PAL can be used at any eligible school across the country. This offers a distinct advantage to anyone who lives in South Carolina or wishes to attend school in the state, as they will be take advantage of the opportunity for a private loan with a low, fixed interest rate by SCSL.
Loans for South Carolina Teachers
South Carolina Student Loans also offers three separate programs for aspiring teachers in South Carolina: the SC Teachers Loan Program, the SC Career Changers Loan Program and the SC Program of Alternative Certification for Educators (PACE) program. These student loan programs were formed with the goal of helping to improve education across the state of South Carolina by helping talented students achieve their goal of becoming a teacher. In addition, some teachers with SC Teachers Loans or SC Career Changers Loans may be eligible to have part of their loans forgiven by working in either a critical subject or a critical geographic area. Combined, these programs work together to help South Carolinians improve their quality of education across the state.
As a non-profit educational lender, the loans available for teachers through SCSL have a low, fixed interest rate. This rate is tied to the interest rate for unsubsidized Stafford loans available from the federal government, plus 2 percent. The total interest rate charged for these loans will not exceed 8.25 percent. Repayment on teacher loans will begin six months after graduation or after a borrower falls below half-time status, provided that the borrow is not teaching.
SC Teachers Loans
For any South Carolina resident who wants to become a teacher, the SC Teachers Loans program may be ideal. This loan is only available to residents of South Carolina who are citizens or permanent residents of the United States and are enrolled on a half-time or greater basis at an approved institution. While SC Teacher Loans function like most private loans, they are different in one very important respect: they are eligible for student loan forgiveness. These loans, available only through SCSL, are funded by the State of South Carolina.
SC Teachers Loans have strict eligibility requirements, as they are designed to be used by talented and qualified students in order to enhance the quality of education in South Carolina. In addition to the standards listed above, incoming freshman must be in the top 40 percent of their high school graduating class and have a SAT or ACT score that is either greater than or equal to the average for South Carolina in the year that they graduate.
Currently, those scores are 975 for the two-part SAT, 1442 for the three-part SAT and 20 on the ACT. Students must either be enrolled in a program of teacher education or have expressed an intent to enroll in a teacher education program. Once enrolled, participants in the program must maintain a 2.75 grade point average or higher (on a 4.0 scale) and have taken and passed the Praxis Core exam (with some exemptions from taking the Praxis exam for students with high SAT or ACT scores).
Graduate students must enter with at least a 2.75 grade point average and then must maintain a GPA of 3.5 or higher. The program is also open to current teachers who are seeking their initial certification in a different critical subject area that the certificate that they currently hold. The application progress requires a potential borrower to fill out the SC Teachers/Career Changers Loan application each year that the loan is required. If a student changes schools, then he or she must re-apply for the SC Teaches Loan.
To help prospective teachers pay for their undergraduate and graduate educations, SC Teachers Loans are available up to a total of $20,000. This includes $2,500 per year for freshmen and sophomores and $5,000 per year for juniors, seniors and graduate students. For teachers who choose to work in a critical geographic area or teach a critical subject in a South Carolina public school, loan forgiveness is available. As described in greater detail below, loan forgiveness reduces a teacher’s total loan debt by up to 20 or 33 and 1/3 percent each year that they teach a critical subject or in a critical geographic area.
When applying for a SC Teachers Loan, applicants must indicate whether they intend to teach a critical subject or in a critical geographic area. If the subject is removed from the critical list after a student has already indicated that they wish to teach in this subject, the critical designation will be honored for purposes of loan forgiveness. Similarly, if a geographic area is removed from the critical designation after a teacher signs a contract to teach at a school in a critical geographic area, it will still be considered a critical area for purposes of loan forgiveness.
Loan forgiveness is an incredibly important tool for both prospective teachers and the citizens of South Carolina, as it gives them significantly more financial incentive to teach the subjects or in geographic areas that are most needed in South Carolina. This program is only available through SCSL, as it is the exclusive state-designated non-profit educational lender.
SC Career Changers Loans
For anyone who wishes to switch careers, the SC Career Changers Loan program can assist with that transition through low interest loans that are eligible for forgiveness if certain qualifications are met. This program has many of the same requirements as the SC Teachers Loans program, with some additional standards specifically geared towards people who have chosen to leave an established career to become a teacher in South Carolina.
As with the SC Teachers Loans program, to be eligible for a SC Career Changers Loan, an applicant must be a resident of South Carolina and enrolled at least half-time in a course of teacher education at an accredited institution. However, because the Career Changers program is only for those South Carolinians who wish to switch to teaching from an entirely different profession, these loans are not available to current teachers. Instead, the program requires applicants to have a baccalaureate (undergraduate) degree for at least three years and to have worked full-time for at least three years.
The requirement of having a baccalaureate degree is waived for anyone who is an instructional assistant in the South Carolina public school system. The academic requirements are waived for the first year that a student applies for a Career Changers loan, but students will be required to maintain at least a 2.75 (undergraduate) or 3.50 (graduate) grade point average after that first year.
Career Changers Loans are available in amounts of up to $15,000 per year, with a maximum loan amount of $60,000. This higher amount is important, as many participants may have already exhausted other forms of financial aid or student loans when they obtained their original degrees. The program is meant to encourage professionals across South Carolina to put their skills and real world experience to work for the children of South Carolina by becoming teachers. These loans can make that transition possible, along with the potential of loan forgiveness for teachers with SC Career Changers loans who choose to work in a South Carolina public school in a critical geographic area and/or teach a critical subject. Loan forgiveness could be as high as $5,000 per year of teaching, if a teacher chooses to teach a subject listed as critical by the state of South Carolina in a school located in a critical geographic area.
SC Program of Alternative Certification for Educators (PACE)
Traditionally, teachers in South Carolina and throughout the United States obtain certification through a teacher education program. However, the state of South Carolina offers an alternative route to teacher certification This is often used by professionals who decide to change their careers after working in a different field. The Program of Alternative Certification for Educators, commonly known as PACE, allows career changers to undergo a three year program to obtain certification while teaching in their specified content area. SCSL offers a special loan for those enrolled in PACE, available in amounts of up to $750 per year to a maximum of $5,000.
To be eligible for a loan through SC PACE, an applicant must be enrolled in the South Carolina Program of Alternative Certification for Educators and have received an educator’s certificate for the current year. An applicant must also be teaching full-time in a South Carolina public school. Loan forgiveness is available for the SC PACE loan program for anyone who teaches during the same year that they receive funding. Applicants can download the PACE loan application directly from SCSL’s website. If their application is approved, then a check will be mailed directly to the student to cover the costs associated with becoming certified through PACE.
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Teachers who have loans through either the SC Teachers Loans or SC Career Changers Loans programs may be eligible to have part of their loans forgivenif they teach in a South Carolina public school in a critical subject area or geographic area. These loans are forgiven at a rate of 20 percent or 3,000 dollars (whichever is higher) for each year that a teacher teaches a critical subject area or works a South Carolina school that is in a critical geographic area. For those who teach a critical subject area in a critical geographic area, their loans will be forgiven at a rate of 33.33 percent or $5,000 (whichever is greater) for each year of full-time teaching. Employees must teach for a minimum of 76 days per academic year to be considered for loan forgiveness.
Critical subject areas are those which are designated by the state of South Carolina as ones that are of increased importance or require more teachers. The list changes annually, and cane viewed directly on SCSL’s website. For the 2016-2017 school year, critical subjects include languages (Spanish, French, Russian, Chinese, Japanese and other languages), secondary-level math, science and social studies, theater, and agriculture.
Critical geographic areas are those schools or school districts that are in need of teachers, often due to high levels of poverty or a rural location. Each year, the state of South Carolina designates certain schools within different school districts as “critical geographic areas.” Teachers who are hired to work in these schools may be eligible for student loan forgiveness for each year that they teach there. Importantly, if a school is deemed a critical geographic area at the time that a teacher signs his or her contract, then the loan forgiveness program continues even if that designation changes.
Author: Jeff Gitlen