A Private Student Loan (sometimes referred to as an alternative loan) is a loan offered by a private lender such as a bank, credit union, state agency, or a school for students who want to borrow funds to pay the cost of attendance. Typically undergraduate students will need a creditworthy cosigner to qualify. Can borrow up to the cost of attendance minus all other financial aid. The minimum borrowing amount is $1,000.
The interest rate will be based on a credit strength estimate provided by co-signer. Quatromoney uses estimated interest rates based on self reported credit strength: Excellent = 4.17%; Strong = 6.69%, and Good = 9.69%. Typically families with Not So Good credit will most likely not qualify. Interest accrues from disbursement. Borrowers may opt to defer all payments while in-school payment and during the 6-month grace period.
Typically, these loans offer limited deferment and forbearance options and most offer no loan forgiveness, loan discharge or cancellation options.