Private Loan Lenders
Our office does not post or verbalize to students the names of private loan lenders. Students are encouraged to visit multiple lenders’ web pages to verify the interest rate, repayment options, fees charged, and borrower benefits. Our office does not endorse any lenders, receive any incentives, or have any arrangements or agreements with any lenders.
Considerations When Selecting a Lender
Applications and Eligibility
Requirements vary according to lender. Some of the most common borrowing requirements are as follows:
- must be an undergraduate or graduate student in a degree or certification program
- must be enrolled at least half-time
- must be a credit-worthy borrower or a borrower with a credit-worthy cosigner
- must maintain Satisfactory Academic Progress
- must be a U.S. citizen, permanent resident, or eligible non-citizen
Interest Rates and Fees
Interest rate options vary. The interest rate options may be fixed or variable rates. Many education loans involve fees. Fees are usually added to the amount requested to borrow, but sometimes they are deducted from loan proceeds. Borrowers should consult their lender and read their promissory note carefully to determine the interest rate and fees associated with their loan.
Repayment and Deferment
Lenders are often willing to allow deferment of payments while the borrower is enrolled in school at least half-time. During this time, interest may accrue, but the student does not need to make any monthly payments. Students should contact their lender for specific options.
Borrower benefits can significantly alter the cost of a loan. Students should research the fine print on a lender’s borrower benefits and keep up their end of the bargain.
Finding a Lender
Students should start their search for a reputable lender with their bank, credit union, or other financial institution. Students should always compare several loan options or lenders.
Employers sometimes help families pay for children’s education by offering financing options of their own. For example, some employers help employees with education expenses such as education through private loans, automatic deductions from paychecks, and other financing options.
Use the Internet to search websites that list alternative (private) loan lenders.
Questions to Ask a Potential Lender
- Can the application be completed online?
- What is the approximate time it takes to obtain a decision for loan approval?
- Is a cosigner required?
- What is the minimum and maximum loan amount per year?
- Are there minimum enrollment requirements?
- Can I borrow for past due balances?
- Do I need to be enrolled in a degree-seeking program in order to qualify?
- Is the interest rate fixed or variable? If variable, how frequently can the rate change?
- Are there any loan fees?
- Does the interest rate change when I enter repayment?
- What fees are applied to the loan and when and how are they applied?
- When does repayment begin? What will be my monthly payment?
- Is the interest and/or principal deferred while I am in school?
- What are the repayment options and are they any repayment benefits?