Citibank Cancels CitiAssist Student Loan Program at Several

Source: http://blog.clearadmit.com/2008/10/citi ... s-schools/

Citibank Cancels CitiAssist Student Loan Program at Several Business Schools

A piece in the Economix column of the New York Times earlier this week called attention to troubling news regarding the impact of the current credit crisis on the availablility of student loans to MBA students, particularly private loans administered through the CitiAssist program for international students.

The piece, entitled “Credit Crisis Is Bad News for M.B.A. Students” excerpted an email message sent to students Monday at MIT Sloan School of Management. According to that message, Citibank has exercised its 30-day option to cancel the CitiAssist custom student loan program with MIT Sloan, effective November 2, 2008.

The Economix column went on to explain that students who have already had their loans processed and approved by Citibank appear to be safe, but that those who still need to secure financing face greater problems. “The school is now helping students scramble to find alternate financing,” the Times reported.

The problem is not limited to MIT Sloan. The CitiAssist program is also ending at the Ross School at the University of Michigan, according to the school’s own website.

Information listed on the Ross site about the CitiAssist program indicates that of the 3,500 University of Michigan students who took out private loans in 2007, 68 percent did so through the CitiAssist program. But a bulleted point highlighted in red in the program description reads, “This loan program will end on 11/02/08. Priority date for applications is 10/15/08. Applications received after this date may not be processed.”

In a phone interview this morning, Randall Sawyer, dean of admissions for the Johnson School of Business at Cornell University, said that as he understands it, Citibank has removed its CitiAssist program from all of its schools for international students without a domestic cosigner. Harvard Business School and the Wharton School at the University of Pennsylvania have also historically been part of the CitiAssist program.

“It’s affecting us, though not on a huge scale,” Sawyer said, indicating that schools with greater numbers of international students could be facing a larger-scale problem. “It’s certainly something that we are talking about though,” he continued.

According to Sawyer, even students who have secured funding for this year may still be unsure about whether they will find funding for next year. “At this point we don’t have any official release about the situation,” he said, but he indicated that Johnson would do its best to help students find alternate sources of funding.

Clear Admit plans to stay on top of this unfolding situation as it impacts prospective MBA applicants. Watch this space for more details as they become available.

Some of our internationals are pretty worried about next year now.

Here goes my dream of MBA!!!

I should have gone for the offer I had this year

I will live with regrets!!!

dang..thats not good news..there goes my porsche..shoot.. yup i was planning on spending all my money on that porsche and take a loan for b-school...

most of internationals (such as me) wont be able to fund b-school with their lifetime earnings in their own country, US b-schools are huge leg up for an international career...

if the comment above was meant to be sarcastic, then it was a rather ill-targeted one

naah.. dont think that comment was sarcastic.. just comical..

the same situation for chicago gsb.. citi cancelled its loan program last week.. its happening in all mba schools..

well looks like mba for intl students is gonna be a tough prospect this year...

That's right about GSB. Internationals will need an American co-signer to have loans, it's going to be tough...

Bloody hell let's hope that the situation gets better in a couple of months for my second year... I don't have acosigner unfortunately.

What a crap situation.

PS: does the cosigner have to be just American (living abroad for example) or does he/she have to be living in the States?

It has to be an American with a credit history that the lending company is comfortable with.

I'd assume that an American living abroad would not qualify.

RF

There goes my plan to travel early next year. Now I gotta work and save up. To top it off - the Australian dollar (and my savings with it) has crashed.

I don't think you guys should spend too much time worrying about it. I have no doubt the schools affected are working their asses off to find alternative funding for international students. You have to remember, this affects a LOT of their students, up to 40% in some cases.

I know at Tuck, their financial aid office did a lot of work for incoming students and I was told "If you want to come to Tuck, they will find a way to make it happen."

It might take a few months for something else to be worked out, but be patient.

RF

If a US citizen becomes a co-signer for an intl student, how would it affect this person's credit score etc?

Thanks!

I actually asked this question when I got my loan and the response was the American needs a current US address.



I believe the effect on the person's credit score would be the same as he/she taking out the loan himself.

The situation really blows and I wonder what the schools will do. If you look at Ross website it actually states that the loan program will end on 11/02/08:

http://www.bus.umich.edu/admissions/financialaid/loans/Private.htm

Wharton website also says something about the issue, although much more vague:
"Please note: the availability and terms of condition of this program, as with all financing options, are subject to change."

http://www.wharton.upenn.edu/mba/admissions/finance/loans.cfm

no sarcasm intended.. just stating what a lot Harvard bound students do, they buy expensive cars so that can drive down their savings so that they can qualify for loans and financial aid..

Jerks.

How should I do? Who know any sources of financial loan? I am a foreign who dont have any US-cosigner. Very depressive.

I'm on the same boat...would love to hear about any other financial option for internationals without a US cosigner.

I wonder if it will start to get tougher for international students to get into American schools. It seems to make sense that if students can't get financial aid that there will be less students. Schools will be forced to only admit international students who can self-fund themselves.

I don't think this situation applies to internationals, or students at other schools for that matter.

HBS is so wealthy that they give out scholarships to a great portion of their incoming class. If you have any holes in your funding scenario, it seems that they will help you out. Therefore, their students create these holes by purchasing BMWs, etc. and as a result you see their garage full of these cars being driven by students who are supposedly "financially needy".

If you go buy a BMW before you attend any other school, tough luck. You will likely have to take on extra loans to cover the cost of your new driving machine.

Hey,

Any idea on what might happen for international incoming students this year? This must be a concern for a pretty big number: http://www.bloomberg.com/apps/news?pid= ... refer=home

Also, would it be possible for somebody to explain how the co-signer model works?

Thanks!