Private educational loan programs are non-federal loans issued by banks, savings and loan associations, and credit unions. These programs allow students to borrow up to the full cost of attendance* minus other forms of financial aid. Private educational loans carry variable interest rates based on the LIBOR rate or the Prime rate and repayment periods may range from 5 to 25 years. Interest rates, origination fees, loan maximums, and repayment terms should be carefully considered when researching and choosing a private loan.
Before obtaining an alternative loan, graduate students should compare the terms of the loan with loan assistance available through the Federal Direct Stafford Loan Program. Most private loan programs are not competitive with the Stafford Loan Program and are intended to provide supplemental educational financing.
*A student's cost of attendance includes actual tuition and fees and standard allowances for books, supplies, and living expenses.