About Private Student Loans
A student loan is a special type of low-interest loan that is issued to students in order to help pay for college tuition, books, and other expenses. Student loans are tailored to student borrowers, and as a result, are distinguished from other types of loans by their borrower-friendly application processes, favorable interest rates, and flexible repayment terms. Private student loans are offered by banks and other financial institutions, from leading national lenders to local banks and credit unions, so you will have many options when searching for funding for college. Private student loans are intended to supplement federal student loans, not replace them; for many students, federal loans aren't enough, and in this case, private loans can be a good final source of funding.
Private student loans are a good option if after exhausting your federal loans, scholarships and grants you still have a gap in college funding. For example, let's take this scenario. A typical student has a $32000 annual college bill and receives $10,000 in scholarships and other reductions, leaving a balance of $22000. The student in maximizing his federal loans is able to get $5500, leaving a balance of $16,500. The parents may then contribute $8500 from their income, savings or parent loans leaving a typical gap of $8000. The student can use a private student loan to fill that gap. Now, there are many available and interest rates, fees and other terms can vary widely from lender to lender. So, it really pays off to compare among them and to find the most competitive one for you. If you find you need a private student loan, you should use SimpleTuition to compare loans available for your school and apply for the best private student loan for you.
Benefits of Private Student Loans
College has never been more important, and yet a college education has never been so expensive. Students and their families currently face this unpleasant conundrum; what's more, financial aid resources are quite limited at the overwhelming majority of institutions in the country, an issue which only compounds the problem of affording college. Fortunately, private student loan options exist to provide students and families a final source of funding to fill the financial gap between one's tuition bill and any financial aid received.
Key Facts about Private Student Loans
Private student loans:
How to Choose the Right Private Student Loan for You
Here are a few pointers on how to choose the best private student loan for you. First, compare, compare, compare. There are many different loans out there, and it is extremely important to thoroughly research all of your loan options so you are aware of the specific details of each individual loan. Consider the loan's APR (Annual Percentage Rate), which bakes in all the costs associated with the private student loan so you can compare one loan to another on an apples-to-apples basis. Be aware of the total cost of the loan, which factors in interest rates and repayment timelines to calculate just how much borrowing will cost you when all is said and done.
Applying for a Private Student Loan
Before applying for a private student loan, as we mentioned above, it's important to compare your options. To search for and compare your loan options, use our student loan comparison tool right on this page. It will provide you with transparency regarding all of your different loan options, and once you find the loan that's right for you, you can apply for it.
Q:How do I apply for private student loans without a cosigner?
A:You can apply for most loans even if you don't have a cosigner. Just use the regular paper or online application. However, it's important to note: if you don't have a cosigner, you'll probably need a good credit history or your loan application may be denied. If you don't have a cosigner and don't have a good credit history, you may have better luck with federal student loans, which don't require either.
Q:What are the benefits of getting private student loans with a cosigner?
A:Private student loans with a cosigner means you'll have an easier time qualifying for a student loan and may get a lower interest rate when you do. Getting a private student loan without a cosigner, on the other hand, is quite difficult since the lender may be apprehensive about lending to a student without a cosigner. In addition, your interest rate may be higher, increasing the total cost of your student loan.