Private Student Loan
There are several sources of loans to assist both students and parents with paying for college. The chart below will help you understand the basic differences between each type of loan. If you file the Free Application for Federal Student Aid, the student's eligibility for federal student loans will be indicated on his or her Financial Aid Notification. Information about how to apply for federal loans is available through the student portal (mySTAR).
Creditworthy parents of dependent students may choose to pay their out-of-pocket college expenses by borrowing a Parent Loan for Undergraduate Students (PLUS). Parents will begin to repay the PLUS during college. Parents may defer repayment, in some cases, however, interest would accrue during the deferment period. Please refer to the U.S. Department of Education's PLUS web site for more information.
Educational Loan Chart 2013-2014
|Federal Direct Subsidized Stafford Loan
||See Federal Direct Stafford Loan.
||U.S. citizens or permanent residents demonstrating financial need
||Fixed rate—Begins 6 months after student leaves school or drops below half time enrollment (6 credit hours).
|Federal Direct Unsubsidized Stafford Loan
||Students who have not received the max Federal Direct Subsidized Stafford Loan. Independent students may have additional eligibility.
||Fixed rate—Begins 6 months after student leaves school or drops below half time enrollment (6 credit hours). Interest accrues while in school.
|Federal Direct PLUS Loan
||Up to the cost of education less aid received
||Parents of dependent students
||Submit FAFSA and loan application
||Fixed rate—Begins 60 days after entire loan is disbursed or 6 months after student leaves school.
* The Federal Stafford Loan amounts listed above may be subsidized or unsubsidized, based on financial need. Up to an additional $2,000 unsubsidized loan is available for all undergraduate students ($12,000 for graduate students). Furthermore, additional unsubsidized amounts are available for independent students and for students whose parents are denied the creditworthy Federal PLUS ($4,000 for freshmen and sophomores; $5,000 for juniors and seniors).
Private (Alternative) Loans Based Upon Credit
Before applying for a private education loan it is highly recommended that you do your research. Please talk to a SFCC Financial Aid Advisor and review information available at the U.S. Department of Education web site.
These educational loans are available from private lenders and offer additional financial assistance if you have exhausted all other sources of funding for your education. You should utilize all of your eligibility for grants, scholarships and federal loans before considering any private loan. Private loans typically have variable and higher interest rates, higher fees, and less flexible repayment options than federal loans. Each private loan lender has different eligibility requirements, loan rates, repayments terms, and conditions. Many lenders require a co-signer and some may require payment of interest while you are in school. There are several lenders that offer student private loans. You may select any lender you wish for a private educational loan.
All private loan lenders are required to provide to student borrowers three disclosure statements and a new Self Certification Form prior to the school being able to certify the loan. The student will be required to complete and return the Self Certification Form to the lender. It is highly recommended you talk to a financial aid advisor prior to obtaining a private loan to ensure all other financial aid options have been explored.
Other types of disclosures the student will receive include:
- Application Disclosure
- Loan Approval Disclosure
- Final Disclosure (Prior to Disbursement)
If you plan to apply for a private loan, you will need to be timely and proactive in acknowledging and providing any information requested. Delays in acknowledgement of the above disclosures or in completion of the Self Certification Form will delay disbursements.