Private Student Loans Introduction
Private student loans, funded by banks and non-profit organizations, provide an additional source of financial aid for students.
PrivateStudentLoans.com offers two types of private student loans - a direct to student private loan and a school certified student loan. Not sure which is right for you? Compare the features of both or see the chart below.
Both loans have similar, great benefits:
- No payments until after graduation [b];
- Competitive rates and fees - fees as low at 0% [c] for the most creditworthy borrowers;
- 24/7 online application - online decision made usually in less than a minute;
- Borrower benefits for automatic bill-pay and/or consecutive on-time payments - up to 1% off your interest rate [d].
A significant difference between the direct to student private loan and the school certified private loan is how the funds are disbursed:
Direct to student private loan funds are sent directly to the applicant(s) [a] to allocate towards the student's cost of education. You may use your funds for tuition, room and board, school fees and other education related expenses.
School certified loan funds are sent to your school. The maximum you can borrow depends on what your financial aid officer determines your need to be.
| Direct to Student | School Certified | |
|---|---|---|
| Funds | Sent straight to the applicant(s) [a] | Sent to your school |
| Minimum Borrowing Amount | $2,500 | $500 |
| Yearly Borrowing Amounts | Up to cost of education | Up to cost of education |
| Aggregate Lifetime Borrowing Amounts | $250,000 | $250,000 |
| Deferment | No payments until after graduation [b] | No payments until after graduation [b] |
| Repayment | Up to 25 years [e] | Up to 25 years [e] |
| Loan Fees | As low as 0% [c] | As low as 0% [c] |
| Interest rate* | Prime minus .5% to Prime plus 7.9% [f] | Prime minus .5% to Prime plus 7.9% [f] |
| Borrower benefits | Up to 1% off your interest rate [d] | Up to 1% off your interest rate [d] |
| Co-signer release available? | Yes [d] | Yes [d] |
[a] The Direct to Student Loan does not require school certification and the proceeds are disbursed in the form of a check co-payable to the borrower and cosigner (if applicable), mailed directly to the applicant with the stronger credit profile.
[b] The deferment grace period is defined as 12 months from graduation or 6 months after a student drops below half-time enrollment. For the Student Loan Network Direct to Student Loan, repayment will begin no later than 60 months (5 years) after the loan is disbursed.
[c] For well-qualified applicants subject to credit approval and other restrictions. A "well-qualified applicant" is an applicant with a strong credit profile according to Lender's current underwriting guidelines accompanied by a creditworthy co-signer.
[d] At all times the discount rates and co-signer release terms are subject to change. The on-time benefit must be earned. Co-signer release is contingent upon the borrower's credit profile which will be reviewed by the Lender prior to release. Loan delinquency, default, or the use of forbearance may result in the revocation of all borrower benefits.
[e] The repayment period may be less than the 25-year maximum allowed depending on the borrower's indebtedness at the beginning of his or her repayment period and the requirement that the borrower either satisfies a $50 minimum monthly payment amount (level schedule) or the terms of a graduated repayment schedule.
[f] In all cases, interest rates and loan fees vary and are based upon borrower and/or co-signer (where applicable) credit profile, and other underwriting criteria. See our Rates and Fees page for Annual Percentage Rate (APR) examples and other important information about our private student loans.
