Non-federal private educational student loans are offered by banks or lending institutions to help students and parents bridge the gap between the cost of education and the amount of financial aid received. These are private supplemental loans that are NOT guaranteed by the federal government. Terms and conditions can vary according to specific lender guidelines.
Non-federal education loans should be explored only after students have explored their maximum federal education loan eligibility. Non-federal alternative loans should be explored only after students have compared them to federal educational loans. The SRU Financial Aid Office can help you understand your loan options.
Non-federal alternative loans can vary widely in their terms and conditions (such as interest rates, repayment terms, and fees). General characteristics of alternative loans are:
- borrower must be credit-worthy or have a credit-worthy co-signer. Since a credit check is likely, not everyone is approved for an alternative loan
- interest rates can be fixed or variable, and based on the credit rating of the borrower/co-signer and the U.S. treasury rate or the LIBOR rate (London based rate)
- some lenders may assess fees.
To access SRU's lender comparison list, click HERE.
Borrowers may choose any participating lender when borrowing through the non-federal alternative loan programs. In order to assist students who would like guidance in selecting a lender, we have developed a list of commonly-used lenders. We encourage you to compare these and other lenders and choose those whose repayment, services and benefits meet your needs.
Once again, borrowers may choose any lender, even if the lenders not identified on the lender list.
Students should contact lenders directly about non-federal alternative loans. Students are permitted by law to choose any lender they wish for their educational cost needs.
- Does the loan have any front or back-end fees?
- What is the current interest rate and how often does it change?
- If the interest rate is based upon your credit score, what is the highest and lowest current rate?
- Is the interest rate variable or fixed?
- Many lenders offer incentives, so ask how you get them AND how can you lose them (for example, the loan is sold to another lender or you are late on a payment).
- What is the interest rate difference if you have a co-signer?
- How many months will you be in repayment?
- When do you begin repayment?
- Is there any type of death and disability clause?
- Does the lender offer a co-signer release option? If so, how do you request the release and how many payments must occur.
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