Helping Graduates Save on
Student Loans since 2012
Agenda
1. Understand true Cost of Attendance
2. Determining the right sources of funds
3. Choosing the right loan type
4. ...
CommonBond Background
 Focused exclusively on student loan funding needs
of graduate students
 Founded by Wharton alums
...
Cost of Attendance
 Cost of Attendance
 What it is and what it means for you
 What’s in it (and not)
 Additional Consi...
COA: A Comparison
https://commonbond.co/mba-student-loan-calculator
HBS MIT
Sources of Funds
What can you use?
 Personal savings
 Company sponsorship
 Government Loans: Perkins,
Stafford, Grad PL...
Loan Types: Terms & Features
 Interest rate & APR
 Fixed vs variable rates
 Origination fees
 Loan Term
 Credit & eli...
Loan Types: Tradeoffs
10-Year 15-Year
Pay less interest over
the life of the loan
Pay less each
month
@ 6.24%:
Payment: $7...
Choosing A Lender
 Total cost of borrowing
 Loan Features
 Borrower Protection
 Economic Hardship
Forbearance
 Employ...
Timelines
 FAFSA
 School deadlines
 Disbursement process
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How To Pay For Your MBA

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Slides presented in the "How To Pay For Your MBA" webinar co-hosted by CommonBond and Accepted.com on July 16th, 2014. Recorded video will be available the week of July 21st from Accepted.com

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  • Numbers are similar – but what’s covered in each?

    Note there is a $9k total cushion – this is a lot of money!
    Health insurance?
    Moving costs?
    Storage?
  • “No brainers”: scholarships/fellowships, gifts
    “Savings and loans”: Highly personal. Start with how much savings you could contribute and adjust to an optimal amount of savings based on goals, e.g., buying a home soon after bschool. Stay flexible with this number though – we take you through the loan research process next, and you may wish to adjust your contributed savings after you figure out your loan amount.
    You could, but you shouldn’t - retirement savings. You’ll be subject to income tax, but exempt from the 10% early withdrawal penalty. Consider company sponsorship and whether you’re satisfied with the terms carefully (*extra care here – need company line)
  • International – Kenan Flagler
  • Sample calculation

    Rates:
    5 Year Fixed: 3.625% - 5.49%
    10 Year Fixed: 4.74% - 6.625%
    15 Year Fixed: 5.625% - 7.49%
    20 Year Fixed: 6.51% - 8.355%

    5 Year Variable: 2.66% - 4.95%
    10 Year Variable: 2.785% - 5.65%
    15 Year Variable: 3.16% - 5.99%
    20 Year Variable: 3.535% - 6.680%
  • How To Pay For Your MBA

    1. 1. Helping Graduates Save on Student Loans since 2012
    2. 2. Agenda 1. Understand true Cost of Attendance 2. Determining the right sources of funds 3. Choosing the right loan type 4. Choosing the right lender 5. Meeting key deadlines
    3. 3. CommonBond Background  Focused exclusively on student loan funding needs of graduate students  Founded by Wharton alums  Raised over $100M from top-tier investors  Growing 300% this year  Featured in The New York Times, The Economist, Forbes, CNBC, Wall Street Journal, Inc. Financial Times, TechCrunch…
    4. 4. Cost of Attendance  Cost of Attendance  What it is and what it means for you  What’s in it (and not)  Additional Considerations  Travel  Supporting a family or partner  On-campus expenses  Cushion for unforeseen expenses
    5. 5. COA: A Comparison https://commonbond.co/mba-student-loan-calculator HBS MIT
    6. 6. Sources of Funds What can you use?  Personal savings  Company sponsorship  Government Loans: Perkins, Stafford, Grad PLUS Loans  Private loans  Scholarships/fellowships  401k / IRA / retirement funds What should you use?  Highly personal decision  Framework to follow in 6 steps: 1. Safety net 2. Cheap vs expensive debt 3. Risk appetite on variable rates 4. Opportunity cost of money 5. Future plans and purchases 6. Expected future income
    7. 7. Loan Types: Terms & Features  Interest rate & APR  Fixed vs variable rates  Origination fees  Loan Term  Credit & eligibility Detailed definitions at: https://commonbond.co/glossary  International student considerations  Cosigners  Loan Discharge  IBR, PAYE & PSLF  Disbursement
    8. 8. Loan Types: Tradeoffs 10-Year 15-Year Pay less interest over the life of the loan Pay less each month @ 6.24%: Payment: $764 Total Payments: $91,684 *Assuming an $80,000 loan balance @ 6.74%: Payment: $605 Total Payments: $108,950 + / - $159 + / - $17,266
    9. 9. Choosing A Lender  Total cost of borrowing  Loan Features  Borrower Protection  Economic Hardship Forbearance  Employment Protection  Grace Period?  Pre-payment penalties?  Company characteristics  Customer service  Reputation  Network / community
    10. 10. Timelines  FAFSA  School deadlines  Disbursement process
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