Private Student Loan
There are a variety of existing loans available to students pursuing post-secondary education that range from government sponsored loans to private industry loans. Sometimes, when a federal government loan is not feasible, private industry loans can fill the void. In fact, private loans have become much more popular in the last 20 years. It is believed by many that the volume of private loans will easily surpass loans from the federal government within the next 20 years. However, this is largely viewed as a positive occurrence because it means that students have alternative options to fund their continuing education when the government can no longer provide able assistance.
Best Private Student Loans
As previously mentioned, acquiring a private loan is typically only recommended to students who no longer qualify for additional federal government funding or who did not qualify for such loans in the first place. It is also recommended that students inquire about special grants and bursaries that they may be entitled to or qualify for in place of seeking private loans over and above what has already been borrowed from the federal government.
However, students hoping to secure private loans should be vigilant and responsible in researching the provisions of the loan because a number of private lenders will charge rates with a variety of conditions that are different from those attached to certain federal loans. The issue is that with certain extra fees and charges attached the repayment phase of the loan can be a daunting task.
Thus, the best loans to secure for students from a private company would be loans that hover around prime and have no hidden or additional fees attached. One caveat in trying to secure a favorable loan would be the necessity of a strong credit rating for the individual or the co-signer to the loan. Alternatively, one can look to secure a loan attached to the LIBOR rating system rather than the prime lending touchstone.
Private Loans Compared
Similar to certain federal loan plans, most private lenders will have a limit or a formula to determine a limit for each individual that attempts to borrow. However, students must also be cautioned that not all of the information and rates will be fully apparent until after a loan has been signed into force in order to prevent one from comparing rates and limits between private companies and the federal government loans.
Acumen provides loans with low interest rates and with a variety of repayment options. Charter One offers an incredibly low interest rate on their loans, but note that such rates are subject to change at any time. The Citizen’s Bank offers a very similar low-rate of interest to that of Charter One, but also emphasizes the fact that rates are subject to change at the discretion of the lender.
The Commerce Bank provides a unique reimbursement whereby interest rates are fairly average, but a more punctual repayment schedule offers certain deductions or adjustments to fees and rates previously applied to the loan. Credit Union also offers a unique opportunity whereby consistency in repayment terms enables the co-signer to free themselves of any further responsibilities attached to the loan.
Finally, there are a number of private loans that are attached to private-state-school institutions that will collaborate with borrowers and lenders to adjust rates accordingly to a student’s attendance record and performance while enrolled. There are also a few website-based lending opportunities that require students to prepare and submit an application to determine the viability of acquiring a loan.