A postsecondary degree has quickly become one of the most sought-after and lucrative possessions a budding career person can have. For more reasons than we can describe here, a significant and ever-increasing number of people, young and not-as-young, are going to school to earn themselves that powerful undergraduate or graduate degree. However, frequently, the one major problem with this scenario is the cost of the postsecondary education. With each year, tuitions seem to hit new peaks; yearly housing prices, on-campus and off, are also moving up; academic financial aid offices are stuck playing catch-up to the costs of their own school's academic program. Consequently, prospective students are often left with no choice but to finance their education through loans, federal and private.
The eligibility requirements for federal or government loans are pretty straightforward: first, the borrower needs to be an American citizen, a permanent resident, or an eligible non-citizen, and second, the borrower needs to fill out and submit the Free Application for Federal Student Aid, commonly known as the FAFSA. The requirements for private student loans, at least of the traditional sort, are a little more tricky: usually, private loans are issued on the basis of the borrower's credit score. However, since many student borrowers do not have well-developed scores, lenders rely on the credit score of loan cosigners who agree to step in and make the loan payments in case the original borrower cannot make them.
People Capital and its alternative peer-to-peer (p2p) lending platform is here to offer students better conditions on their private loans. P2p loans do not wholly depend on credit scores. Using the Human Capital Score, People Capital's data-driven method of producing a credit-risk analysis, students may be able to benefit from loans at lower interest rates. Peer-to-peer lending is changing the way students are thinking about education finance.
For more information on People Capital's peer-to-peer approach, please click here.