SOCIAL LENDING: STUDENT LOAN ALTERNATIVE; GreenNote.com is a unique company that utilizes social networking to garner loans

College Credit Crunch

THE COST OF EDUCATION: With college prices on the rise and the economy in a slump, student loans are being relied on more than ever. According to the nonprofit group Project on Student Debt, in the past year alone, the average student loan for two-thirds of college undergraduates have increased by 5 percent to $22,000. A college education will not only expand your knowledge. It will also increase your earning potential. According to a 2007 College Board Study, people with a bachelor's degree earn 60 percent more than those who hold only a high school diploma. Over a lifetime, that can mean a difference of more than $800,000 in income.

SOCIAL LENDING: STUDENT LOAN ALTERNATIVE: Now there's a new loan option for students seeking a higher education. GreenNote.com is a unique company that utilizes social networking to garner loans. The web-based company connects students with their social network of friends, family, friends of family and community to ask for small loans. GreenNote turns the loans into legally binding agreements and handles their details through their repayment. Compared to typical student loans, GreenNote loans cost less -- 6.8 percent versus 8.5 percent to up to 20 percent. The interest rate is fixed and is paid off within 10 years. The lenders can also earn money while helping a person they care about earn a college degree. The company earns money through a one-time documentation fee paid by the student and a small management fee from the lenders. So far, around 6,000 students have used the site.

THE AGE OF THE INTERNET: Many other sites that offer help for students seeking loan are popping up, including the following:
· VirginMoney.com: This site offers both traditional lending and social lending options.
· FirstAgain.com: Offers short-term lending with low fixed rates over one to seven loan terms that must be repaid immediately. These loans are for families who have a credit score in the high 700s.
· Tuitionbids.com: This site provides one online application that is sent out to different lenders in order to find the right match for you.

HELP FOR HARASSMENT: Experts caution students not to accumulate too much debt. For students who are being harassed by a debt collector, the site StudentLoanJustice.org may be able to help.

If you would like more information, please contact:

Shelley Honeycutt, shoneycutt@aaane.com