Student loan lending giant Sallie Mae calls its new Smart Option Student Loan program an innovative way for students to save money on private loans. Asking full-time students, without any income, to make monthly payments is indeed a smart move for lenders facing an economic crisis and rising default rates, but not for students.

The new program may sound appealing to students thinking about the looming future of making interest-heavy payments. Sallie Mae makes it sound simple; pay off the interest on the loan while still in college. Students are urged, though, to read the fine print. Just like any loan used in the financial aid process, there are always variables. Interest rates vary according to the student’s credit score. Most students have no credit score, therefore making interest rates skyrocket. The only way many will be able to afford the monthly payments is with a co-signer who has a good credit score. While many may be able to elicit the help of parents, some students who are financing their own education will be victim to variable interest rates.

According to Sallie Mae spokesperson Patricia Nash Christel, hypothetically a student who borrows $8,000 will have to pay about $70 a month. That may be gas, food and rent money that most students don’t have. Students should be aware of what happens when that extra $70 isn’t available one month and they miss a payment. According to the Sallie Mae Web site, missing just one payment puts a student under the delinquency category, affecting that person’s credit report — something that can follow students for a long time. In the long run if a student fails to pay back a loan on time he or she will be defaulted and could have wages garnished or be sued for the balance of the loan.

For students and families who are positive they can afford the monthly payments, this program could be a smart move. It would keep overall loans down and increase a student’s credit score. But, in many cases this will only be a winning situation for the loan lender who is trying to earn continual capital to make up for rising default rates in the current economic crisis. Thankfully, Larry Chambers, director of student financial services, said the college is not yet encouraging this as an option. Ithaca College is urged to continue to help students with financial aid decisions and educate them on what might not be such a smart option after all.