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Private Student Loans
Loans through private lenders are available as well if government loans don't suit your needs. Eligibility for these kinds of loans depends on your credit score. These can be more expensive than federal loans, but sometimes federal loans simply don't provide enough money. Fortunately, student loan interest rates have a maximum placed on them by the federal government. Also, rates are often lower than this due to competition between lenders. Often, loans through the federal government can offer better interest rates and payment plans than commercial lenders. It can be to your advantage to check out a variety of lenders to get the best rate.

"Private" student loans, also called "alternative loans," are student loans that work more like common types of debt. These loans are not borrowed from the government, but rather directly from a lender and without certain benefits offered through federal student loan programs. Generally speaking, these loans carry larger upfront fees, higher interest rates, and more stringent repayment terms than federal student loans. Many graduate (and even undergraduate) students nonetheless find that supplementing their aid package with this loan type is necessary to "close the gap" between their cost of attendance and available resources. The average cost of graduate school has skyrocketed by 60 percent within the last decade. This huge university price hike has helped private student loans become the fastest-growing source of college financial aid. In 2005-2006, for example, college students borrowed $17.3 billion dollars in private loans. If you're thinking about taking out private loans to help pay for your on-campus or online master degree you need to understand the facts.
Benefits of Private Loans
  • You don't have to prove your financial need to obtain private loans
  • May have lower rates than standard loans
  • Fast approval and quick disbursement of funds
  • Possibility of rate reductions for on-time payments
To be eligible for Private Loans, you should first meet the following requirements:
  • Have an official Social Security number
  • Have no defaults on any prior student loans
  • Have a clean credit record
  • Be a U.S. citizen or permanent resident status
  • Have a co-borrower if you are a foreign-born student