Need help paying for college? A private student loan is a great option to fill in the gap between your federal loans and the cost of attending college. See reviews on top student loan lenders, their rates, and our customized ratings.
Student Loan 101:
There are two main types of student loans available. Federal student loans and private student loans. Federal student loans are offered by the government, these terms and conditions are set by law. Private loans are made by private organizations like banks, credit unions, and state-based or state-affiliated organizations Private student loans have terms and conditions that are set by the lender.
Typically, federal student loans are generally less expensive than private student loans and come with more favorable terms and conditions.
Private Student Loans:
Private student loans are offered by banks, credit unions, and online lenders. Their rates are often variable, meaning your interest rates and payments may go up over time.
This type of loan option is typically more expensive and is offered to borrowers who have exhausted or may not be eligible for federal student aid.
Private student loan rates have been as high as 16% over the past couple of years. In terms of repayment, private loans don’t offer as many options compared to federal student loans to reduce or postpone payments.
Borrowers offer different rates with varying terms to potential borrowers so it is important to explore your options and do your research before committing to a lender for your private student loans. After borrowing from a private student loan lender, borrowers have the option to refinance their private student loans, which can help borrowers lower their monthly payments and the overall cost of their private student loans.