Notes On Consumer Affairs
Commentary By Assemblywoman Audrey Pheffer
With college acceptance season in full swing, high school seniors and other college applicants are rushing home to check the mail, hoping for the big envelopes that often signal a positive response. Now is the time for students and their families to consider the best way to finance their education. If you or your child has been awarded financial aid, you will receive a financial aid award letter or a call from the prospective college's financial aid office. The college may suggest that you finance part of your education with loans from a private lender. If you choose to take out a student loan from a private lender, it is important to consider any offers from lenders carefully before signing an agreement and to know your rights.
Financial aid offices often present students with a list containing "preferred" lenders that the school has chosen to recommend. Given the potentially deceptive practices that have recently come to light as a result of the Attorney General's ongoing investigation into the student lending industry, it is more important than ever to do your research and make informed decisions when choosing a lender. Students should be aware that just because a lender is on a "preferred lender" list, it does not mean that the particular lender is the right fit for their needs. Furthermore, under federal law you have the right to use the lender of your choice. As with any consumer good or service, it is best to shop around. Be sure to ask lenders if your loan will be sold on the secondary market. In some cases, the sale of the loan could result in the loss of certain repayment benefits guaranteed by the original lender. Before signing any loan agreement, read the terms and conditions carefully, and make sure you fully understand your repayment obligations.
Students should also be aware that the application deadline for the New York State Tuition Assistance Program (TAP) is May 1. TAP assists eligible New York State residents attending in-state postsecondary institutions in paying for their education. The amounts awarded depend largely on income and the academic year that the student begins their studies and other factors. In some cases, annual TAP awards may be as much as $5,000. TAP is considered a grant, and therefore no repayment is required. A student can apply for TAP online while submitting their Free Application For Student Aid (FASFA) application at http://www.fafsa.ed.gov/ , or at https:// www.tapweb.org/totw/ , the New York State Higher Education Services Corporation's TAP website.
For more information on financing a college education, consider making an appointment with a guidance counselor or with the college financial aid office. For information about financing higher education in New York State, visit the New York State Higher Education Services Corporation's website at http://www.nymentor.edu . For further information on the Office of the Attorney General's activities regarding consumers' rights in student lending, call the Attorney General's hotline at: 1-800-771-7755.