Some private student loans come with restrictions on what the loan funds can be used for. In most cases, these loans are made on the condition that the loan funds are used for a specified purpose -- just for tuition, just for living expenses, etc. As its name implies, a school-tuition loan is a loan made specifically for the purposes of paying the tuition fee, either in part or in full, at the borrower’s school of choice. Like most private student loans, school-tuition loans are usually credit-based, which means that lenders will issue funds to only two types of borrowers: those with relatively high credit ratings, or those who can secure credit worthy cosigners with high credit ratings. If a potential borrower does not fall into one of these two categories, he or she might very well not qualify for the best school-tuition loans.
Fortunately, there are alternatives to the old way of borrowing and lending student loans. People Capital has introduced new loan products and an exciting new peer-to-peer lending platform that will enable borrowers to submit requests for student loans where lenders compete, by bidding, often these may result in lower interest rates than loans offered by traditional private-loan providers such as banks, lending corporations, and other large financial institutions. People Capital’s p2p platform will include philanthropic groups, individual investors, even family members and friends as potential lenders. The Human Capital Score, People Capital’s patent-pending method of calculating creditworthiness, considers hard-data (standardized test scores, GPA, choice of school, choice of major) in its risk analysis calculation, and does not focus exclusively on a borrower’s FICO score. The result is a more comprehensive risk-analysis evaluation of the borrower, which can benefit both the borrower and lender.
To learn more about the Human Capital Score and People Capital’s unique loan products and p2p platform, please click here.