Guest post by David Klein, CEO of CommonBond
When I was applying to business school, I thought finding the best financing options would be a lot quicker and much simpler than it really was. My experience was, frankly, terrible: complicated and confusing loan products, one-size-fits-all rates, and little consideration for my actual credit history or future earning potential as an MBA grad. This frustration eventually led me to start a company named CommonBond, a student lending platform committed to a better student loan.
Here are the things that I’d do differently as an MBA applicant, and some suggestions how you can get out in front of your financing needs before you apply:
1. Know the one number that determines your budget. In most cases, the school’s financial aid office will not certify any loans above the MBA program’s cost of attendance (COA). Focus all of your budgeting efforts on this limit.
Not sure what the COA is for this year? We offer a free, online MBA budget calculator that aggregates the COA for many programs so you can make a business school budget in minutes. We try to make the MBA financing process as simple as possible.
2. Make the b-school’s financial aid office your advocate. Talk to them as early as possible: their staff is a resource for students, and what’s more, they want to talk to you. The more financially prepared you are now, the easier you’ll make their jobs later; financial aid officers want to minimize the barriers to having a great business school experience. It’s a win-win for both you and the school.
Tap financial aid offices for historic lender data, for advice on how previous students have funded their MBAs, and for the inside scoop on which student loan providers are popular among current students.
3. Identify your lenders before enrollment. You’ll be busy enough on campus without spending hours tracking down a loan disbursement. Put in extra time now to find a lender you trust and enjoy working with. For instance, at CommonBond, we offer MBAs a low, fixed rate of 5.99% (with autopay) for in-school loans. If you’re interested in seeing how it works, you can go here.
No matter which lender you choose, make sure you ask them two key starter questions: 1) How will you help me if I need to borrow more mid-year for a travel opportunity? 2) What are common issues you see MBA borrowers facing?
Extra tip: lenders typically offer you a discount of 0.25% when you set up automatic loan payments (i.e., “autopay”). Opting for autopay allows you to pay a lower rate and reduce your total amount owed.
Summer is the time to find your best financing options, so put in the effort today for smooth sailing in the fall.
CEO | CommonBond