Researching Private Loans

Before applying for a private loan, students should always exhaust all of their federal loan eligibility. Parents may also want to consider using federal parent loan funds before cosigning a private loan for a student.

The Office of Student Finanical Serivices encourages students and families using private loans to apply for one full academic year at a time rather than on a per-term basis.This prevents multiple credits hits on borrower credit report and ensures that a student has a way to cover their costs for a full academic year, your financial aid counselor can assist you.

We recommend that students apply for a private loan with a co-signer. A co-signer assumes responsibility for a loan should the borrower fail to repay. Having a co-signer on the loan often results in a lower interest rate and reduced fees. Please see our information on the Qualities of a Good Cosigner to help you choose a co-signer prior to applying for a loan.

The following are some questions that you may want to ask your lender or consider when choosing a lender/loan option:

  •     Do you charge any fees for disbursement, repayment, deferments?

  •     Are the fees deducted from the loan disbursements or added to the total loan amount?

  •     Are in school payments required?

  •     What is the interest rate? 

  •     Is the interest rate variable or fixed? 

  •     When is interest capitalized?

  •     Do you offer flexible repayment options? 

  •     Can I request a deferment or forbearance after I leave school and enter repayment?

  •     Do you offer interest rate reductions for auto-debit payments?

  •     How much experience do your customer service representatives have? 

  •     Can I talk to a person, not an automated system? How long is the wait time typically?

  •     Can I email an account representative if needed?

  •     Is there an online application process and instant approval? 

  •     Do you have online account access?

  •     How long have you been lending loans?

  •     Do you have a history of selling loans?

  •     What are my options for loan consolidation?