GreenNote has launched a service that enables students to obtain low-cost student loans from family, friends or anyone interested in helping the student.
Unlike private bank loans or other traditional loans, GreenNote does not require students to have a credit report, co-signer or show proof of citizenship. The rate is fixed at 6.8 percent compared to private lending alternatives that typically carry a variable rate up to 20 percent.
To obtain a loan, a student simply uses GreenNote to create a profile and requests loans from family, friends and others in his or her social network. GreenNote then formalizes the agreement for students and lenders into legally binding loans and handles all the details from loan documentation through repayment.
GreenNote is also planning that anyone can become a lender and use GreenNote to find students based on numerous criteria, including school affiliations, areas of study, extracurricular activities, high school and other demographic data.
Consider the following terms and you would agree that college students, who normally graduate with tons of loans to their name, would highly benefit from this:
• Students can participate regardless of credit history • No citizenship or co-signer requirements • Fixed interest rate currently set at 6.8 percent • Payments deferred up to 5 years; repayment term of 10 years • Lenders receive a return on investment • No prepayment penalties
I just hope this service lasts until my son goes to college (five more years).
