Private Educational Loans

Some students may choose to borrow private educational loans help them meet their cost of attendance. Private loans differ in guidelines, limits, interest rates, and incentives. All involve credit checks and require that borrowers and co-borrowers have satisfactory credit histories. In general, the Graduate Plus Loan is prefarable to a private loan.

Applications for private loans should be made directly to lenders. Apply online or by telephone to insure smooth processing of your loan application.

Although students may apply and be approved by the lender for a higher loan amount, Graduate Plus and private loans must be certified by the Office of Financial Aid. These loans can be certified only to the amount that will bring the student’s financial aid awards to the maximum cost of attendance. An example of this process follows.

2007–08 Cost of Attendance: $60,166

Financial Aid Awards:
Merit Scholarship	11,500
Need-grant	4,000
Stafford subsidized loan	8,500
Stafford unsubsidized loan	12,000
Perkins loan	2,000
Federal Work-Study	2,000
Subtotal Awards	$40,000
Remaining Need:	$20,166
(maximum Graduate Plus Loan or Private Loan)

If a student plans to apply for a private loan, it is important to access credit reports with all three credit bureaus. This can be done online free of charge once a year at annualcreditreport.com.

Based on credit reports, students can clean up late payments, delinquencies, and dispute fraudulent or erroneous entries in order to earn a credit score that may qualify them for private loans.