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The Best Private Student Loans for 2021

We get it! Scholarships, savings, and financial aid aren’t always enough. helps you understand your options, compare lenders, and find the right private student loan to help make your college dreams become a reality!

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Lenders we work with:

Sallie Mae Student Loans
College Ave Student Loans
Commonbond student loans
Discover Student Loans
Ascent Non-Cosigned & Cosigned
How much will my monthly student loan payment be?

Your loan payments are based on the amount you borrow, the interest rate, and the repayment term.

Private Loan Comparison Table

Parent Loans

Federal vs. Private Student Loans

Private Graduate Student Loans

Best Student Loan Rates

Can You Pay for College with A Credit Card?

What Is a Private Student Loan?

If you're looking for no-nonsense information and help with private student loans, you've come to the right place. Let's start with the basic definition.

Definition: A private student loan (also known as a private education loan or alternative student loan) is a non-federal loan used to pay for college or grad school. Private student loans may be an option once you have already exhausted other forms of free and federal financial aid. These loans are typically based on a strong credit history and verifiable proof of income or employment.

How Do I Get a Private Student Loan?

To qualify for a private student loan you will need to demonstrate the following:

  1. Enrollment in a qualified program. Most lenders require that you be enrolled at least half-time at an eligible school, and your loan will go to your school's financial aid office for certification.
  2. Strong credit history. A creditworthy cosigner is highly recommended.
  3. Verifiable proof of income or employment history. Minimum income requirements will vary by lender.

student loan interest rates for May 2020

How to Apply for Private Student Loans

To apply for a private student loan, follow the steps outlined below. We suggest that you also explore all of your federal financial aid options.

  1. Enter the name of your school at the top of this page
  2. Review the lenders that show up based on your school selection. You can compare each lender to see things like current interest rates, repayment terms, how much you can borrow, and highlights on any perks or benefits they may offer.
  3. Choose your lender by clicking on the “Apply Now” button. From here you will be able to submit the loan application.
  4. Fill out all of the information requested and be prepared to invite a cosigner to help you qualify, if appropriate. You will need to provide personal and sensitive information, such as name, address, phone, birthdate, SSN, household income, and loan amount requested. Be sure to take precautions and complete your loan application in a private location.
  5. After submitting your loan application, the lender will provide a disclosure statement which outlines the terms of the loan, including interest rate, any fees, and repayment information. This basically tells you how much the loan will cost.
  6. If you agree with and accept the disclosure, you (and/or your cosigner) will be asked to sign your loan promissory note.
  7. From here, the lender will send your loan information to the school’s financial aid office for certification. The school basically needs to confirm your enrollment and eligibility for the loan amount you requested or were approved for.
  8. At the scheduled time, your loan funds will be disbursed to your school.

Compare Featured Lenders

  • Interest Rates
    • Fixed as low as: 4.25% APR1
    • Variable as low as: 1.13% APR1
  • Interest Rates
    • Fixed: 4.24% APR - 12.99% APR2
    • Variable: 1.24% APR - 11.99% APR2
  • Interest Rates
    • Fixed as low as: 3.34% APR1
    • Variable as low as: 1.04% APR1
  • Interest Rates
    • Fixed as low as: 3.99% APR1
    • Variable as low as: 4.13% APR1

How to Find the Best Private Student Loans?

Shopping around on our site and comparing lenders is a great way to find the best private student loan for your needs. And you'll want to keep in mind that the most ideal private student loans are those that: 

  • Provide competitive interest rates
  • Offer no application or origination fees
  • Do not charge late fees
  • Make a cosigner release available
  • Provide flexible repayment options

How Do Private Student Loans Work?

In much the same way as federal loans, you can borrow what you need to cover the cost of your education-related expenses. If you pass a credit check, your lender will send the loan funds to your school and the money you borrow can be deferred until after you graduate. But you also have the option to pay the interest while you're still in school. Generally speaking, private loans help in these ways:

  • Supplement your other financial aid to meet the total cost of your education
  • Help pay for undergraduate, graduate school, and professional degrees, as well as career training
  • Cover any education-related expense, including books and computers
  • Aid in building your credit — especially with a creditworthy cosigner

You can compare private student loan options on our site. Keep in mind there are a number of popular private student loan names you may see and hear, and it is bound to be confusing. Sometimes the names will be generic, and other times the name will refer to a specific lender’s program or brand name. The name of the student loan program is not as critical as an understanding of how the particular loan terms work, or how they may impact you. To give you a quick primer on some of the most popular private student loan names you may encounter, see the list below.

Sallie Mae’s Smart Option Student Loan®

Private loan options for undergraduate students. Loans are also available for parents and grad/professional students, including medical professionals.

College Ave Student Loans®

Private and refinance student loan options for undergraduate and graduate/professional students.

Discover® Student Loans

Private and refinance student loan options for undergraduate and graduate/professional students.

Undergraduate Loans

This is a catch-all description for loans that typically cover bachelor’s or associate degrees. Some lenders may provide loans for non-degree programs also.

Graduate Loans

Graduate students pursuing masters and doctorate degrees may obtain these.

Law Loans

Graduate students enrolled in a law school, typically post-baccalaureate.

Bar Exam Loans

These are used by bar exam candidates to cover the cost of bar study preparation.

MBA Loans

Graduate loans for students pursuing an MBA in business school.

Health Professions Loans

Used by graduate students of allopathy, osteopathy, dentistry, nursing, optometry, pharmacy, veterinary medicine, and other health professions.

Residency Loans

These loans are for post-graduate medical residents.

Student Loans for Parents

As an alternative to the federal Direct PLUS Loan, these loans often come with zero origination fees and competitive interest rates.

What We Do at

As part of the Edvisors Network, we help you learn how private student loans work, and give you an easy way to compare loans from the country's leading lenders. Get started now to explore student loan options.

If you're at the beginning of the financial aid process, you may find this YesCollege podcast—featuring our in-house expert Elaine Rubin—helpful.

When to Apply for Private Student Loans

If you decide to apply for a private student loan, we suggest you apply as soon as you know where you are going to college. That way your lender can send the private student loan certification form to the correct school.

Instantly Compare Lenders for Your School

And if you’re still considering your options to pay for school, we completely understand. There are a number of considerations that go into deciding how to finance a college education. Choosing to borrow money for college can be stressful and involves a lot of thought and deliberation. Here are some things to consider:

  • The starting point to qualify for any financial aid is always the Free Application for Federal Student Aid (FAFSA®) – pay attention to the priority filing deadlines in your state or at your college, because aid may be awarded on a first-come, first-served basis
  • Review your options to pay for your college costs, including:
    • Personal savings (including 529 plans)
    • Gift aid (think grants and scholarships)
    • Tuition payment plans offered through your school
    • Income from employment
  • Student loans should be considered your last resort option
  • If you still need additional assistance, consider your loan options by comparing your federal student loan and private student loan options according to:
    • Loan terms and conditions
    • Fees
    • Interest rates
    • Repayment benefit (like flexible plans and options of discharge/forgiveness)
  • If you have not already done so, have a talk with your financial aid office to ensure you’ve truly exhausted all other forms of aid before taking out a private loan. In addition to federal resources, your school may be able to provide institutional aid (such as college backed scholarships or college work study).
    • Important: if your family’s Expected Family Contribution (EFC) has changed since you filed your FAFSA, this could materially impact your eligibility for federal or state based aid.

If it turns out that you do need to borrow to pay for college, rest assured you are not alone. According to the Sallie Mae “How America Saves for College 2019” study, more than half of families borrow to cover college costs. In the 2018-19 academic year, parent income and savings only paid $7,801 (on average) for college costs which in total averaged $26,226.

In comparison, students contributed 27% of total college costs from a combination of income, savings, and borrowing, with 14% of total costs coming from loans.

The stark reality is most American students and families have to borrow money as part of the overall financing process to pay for a college education. In fact, according to the 14th Annual Project on Student Debt, “Student Debt and the Class of 2018,” published by The Institute for College Access & Success (TICAS) in 2019, 2 out of 3 graduating seniors had an average student loan debt of $29,200. On top of that, approximately 17% of the debt acquired among the Class of 2018 was non-federal debt.

Private Student Loan Tips

When you consider the value of a college education — including the fact that average lifetime earnings for college graduates are nearly $1 million more than individuals with only a high school diploma or GED — student loans may be a smart investment. If you budget properly and have a good sense of the actual amount of money you need in loan funds to supplement other forms of aid as well as your resources, you can limit your overall indebtedness by borrowing only what you truly need. You should also consider the fact that there are no prepayment penalties. (Note: the lender partners on our site do not charge a prepayment penalty.)

Here are some simple tips to help you pay the least over of the life of your loan:

  • Pay your loan while you’re in-school to reduce the amount of interest you will repay over the life of your loan, you have two options:
    • Making interest-only payments to avoid interest capitalization when you enter repayment (the process where any outstanding interest is added to your principal balance once you enter repayment), or
    • Make small, fixed payments which cover your interest and some of your principal balance.
  • Accelerate payments (pay more than your monthly minimum) to reduce total interest paid and limiting the amount of time on your repayment

You can discuss your repayment options with your lender. If you are unable to make payments while you are in-school, you do have the option to defer repayment on your loan until you are out of school. This option will obviously cost the most money because any unpaid (accrued) interest that is not paid before the end of your grace period will be capitalized — or added — to your outstanding principal balance prior to the start of repayment.

An important consideration is the deferred repayment option means your loan balance at the start of repayment will be higher than what you originally borrowed due to the interest capitalization. Also, don’t let the lack of a sizeable payment stop you from sending even a small contribution to your student loan. As insignificant as it may seem now, even a payment of $10 or $20 a month can help curb the amount of money that would be capitalized on top of your outstanding balance.

Private Student Loan Interest Rates

One final thought concerning the use of private student loans: get a strong understanding of the interest rates as well as the loan’s other terms and conditions. Most lenders offer you a choice between a variable or fixed APR (annual percentage rate), so be sure to read up on the differences between the two interest rate options. Keep in mind that the rates advertised may not necessarily be the rates you qualify for based on your creditworthiness — or that of a qualifying cosigner.

For example, you may see variable rates advertised as low as 1.04% APR, with fixed rates typically slightly higher. But this is a sunny day scenario. You and/or your cosigner would need to have the right qualifying credit score or credit factors to achieve the lowest rate, and the lender may impose requirements such as signing up for auto-debit from a checking or savings account to lock in these low rates. When comparing lenders, look for the asterisks and footnotes along with the fine print to understand what it takes to achieve or put you in the running for the advertised rates.

Can You Pay for College With a Credit Card Instead of Private Student Loans?

Is it wise to use a credit card to pay for college expenses? Just because you technically can does not necessarily mean you should. If you’re considering the pros and cons, here are some things to add to your evaluation.

Credit Cards Private Student Loans
Revolving line of credit that typically carries a variable interest rate, often higher than that of a private student loans. Installment loan with either a fixed or variable interest rate. In some cases, lenders offer discounts on the interest rate for things like auto debit (ACH) payments.
This is a non-school-certified option to pay for college expenses. Must be certified by the college or university.
College/universities may charge a credit card processing fee (or convenience fee). This is in addition to the interest charges the credit card company imposes. Many lenders waive the origination fee. For certain borrowers, this may even make private student loans an attractive option over federal loan options (such as Parent PLUS and Grad PLUS programs).
As an industry standard, credit card payment are due the following month after expenses are incurred.
There is a narrow window (billing cycle of between 21-25 days) to avoid interest charges if balances are paid in full.
Loans may be deferred until after graduation, or interest-only payment may be made during school. If you don't pay the interest, it will be added (capitalized) to your loan balance following the grace period, at the start of repayment.
The primary cardholder is responsible for the debt. There is no cosigner release option. Cosigners may be released after a series of qualifying, on-time monthly payments. This varies by lender. Cosigners may also be released via student loan refinancing. And this includes the option to transfer debt from the parent to the student (through select partners). Eligibility is based on credit an income verification.
Very rarely are forbearance programs available. Deferment or forbearance options may exist during repayment.
Credit cards may carry perks like cash back bonuses and points with partner program (like airlines and hotels). Benefits vary by lender but are usually not as diverse as credit card perks.
Elaine Rubin Financial Aid Expert at Edvisors
Elaine Rubin is the Director of Corporate Communications at Edvisors. Ms. Rubin is responsible for maintaining content, responding to press and media inquiries, as well as serving as the lead contributor for the Edvisors blog and the Ask the Edvisor column. Ms. Rubin volunteers in the local Las Vegas community to help students and families understand the importance of education for success. Ms. Rubin has worked in higher education finance for more than 10 years, including seven years with the U.S. Department of Education's office of Federal Student Aid, and provides information and advice from both personal and professional experiences. She holds a Bachelor of Arts degree in Political Science with a concentration in Public Policy and Administration from Northeastern University.

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