Houston, Texas (PRWEB) October 31, 2008
The financial experts of Community National Bank (CNB) advise students and parents alike to explore home equity loan options to help pay for college tuition.
As a growing number of students and parents struggle to pay college tuition in a harsh economic climate and amid dwindling financial aid and student loans once available, CNB offers a welcome and viable solution in home equity loans.
"A record number of students filed for financial aid in the first six months of 2008, limiting the amount of aid available for the rest of the year. In addition, the number and types of student loans available have changed dramatically this year," stated Community National Bank Chairman and CEO Randy Dobbs.
"Nationwide there has been a 16 percent increase in demand for student loans, with an increase of nearly 20 percent in California, Florida and other states hit particularly hard by the foreclosure crisis. Many students that would normally qualify for financial aid are today being turned down," added Dobbs.
Dobbs went on to explain that some lenders have completely stopped offering private student loans, stating that the lenders continuing to offer private student loans have tightened their credit standards.
As many Houston and Harris County families face the reality of paying for their child's college education, CNB executives wants to make sure they know that there is another option - a home equity loan. The financial representatives state that parents can use the equity in their home to pay for tuition - continuing that refinancing makes the cash available to pay for tuition or to set up a 529 plan to pay for college education in the future.
"A home equity loan can provide a flexible and easy solution to the challenge of covering educational financing. With the prime rate down, many consumers may be eligible for rates as low as 2.55% APR. This rate is very competitive with other college financing options, especially when considering the "after tax" advantages. Interest on home equity borrowing is often tax deductible," added Dobbs.
Dobbs further explained there are many reasons why a home equity loan is a smart choice for financing education. There is no school certification required to determine how much is needed for education, therefore funds can be used for any education related expenses including a computer or a car. The funds are sent directly to the parents and not to the school, there are no financial aid forms to complete and students may attend full-time or part-time.
Last year, $25 to $28 billion in home equity loans was utilized to cover education costs. While many families across the nation will not qualify for a home equity loan because of the nation's home foreclosure crisis, Texas is proving resilient. Although foreclosure rates on loans in Texas went up slightly this past year, it was minimal compared to the rest of the nation.
To learn more about how to a home equity loan can help fund a college education and what the criteria for a family is, log onto http://www.commnatlbank.com or call 713-255-1501 today.