# What are some options for how we may pay the bill?

There are a few payment strategies that Columbia parents commonly use:

**Payment Plan:** Some families simply take the total billed costs minus the total amount of financial aid and pay the remaining amount through the 10-month payment plan. If you choose this option you would make ten equal monthly payments starting July 1. Remember that unbilled expenses are not included in this scenario. For example a family with billed costs of $30,000 would make ten $3,000 monthly payments. A family receiving some financial aid that has $15,000 in unbilled costs would make ten $1,500 monthly payments.

**Long-Term Financing:** Some families choose to borrow most or all of the cost of education, thereby spreading out the payment of educational expenses over ten years. For example, a family may take a $30,000 Federal PLUS loan to cover the billed costs and would begin making monthly payments of approximately $372 to the lender, beginning sixty days after the second Federal PLUS loan disbursement. The second disbursement typically occurs in February since the loan is disbursed one-half for the fall term and one-half for the spring term.

Unlike the payment plan only strategy, long-term options like the Federal PLUS loan allows families to finance unbilled costs like books, miscellaneous expenses and travel. Therefore, a family may choose to borrow more than the billed costs, resulting in a small credit balance for the student each term. Credit balances are made available as a refund to the student.

Please note that there is usually an origination fee associated with long-term financing options and, therefore, the net proceeds received by the school will be slightly less than the total amount borrowed.

**Combination Strategy:** We realize that many families do not have the cash flow or liquid assets to accommodate the payment plan strategy. In addition, many families strive to keep borrowing to a minimum. As a result, we often counsel families to use a combination of payment plan and borrowing that fits the family’s circumstances. In general, it is best to pay as much as possible, interest-free, through the payment plan and borrow the rest using one of the long-term financing options. For example, a family paying $15,000 may choose to sign up for a $10,000 payment plan and borrow the remaining $5,000 using a Federal PLUS loan. In this case, ten monthly payments of $1,000 would be made to the Payment Plan and a monthly payment of approximately $63 would be made to the Federal PLUS lender starting sixty days after the second Federal PLUS disbursement.

For more detailed Information regarding loans available to students and parents please visit the Student Financial Services Web site.