Before looking into private student loan services, make sure you have exhausted all federal loan options. Remember to always compare offers from multiple private lenders to find the lowest interest rate.
When used, private student loans can help you make ends meet whilst pursuing your degree.
Be mindful of each private student loan provider you are considering, as each company has different terms, rates and eligibility requirements. Also, be aware that applying with a co-signer can greatly increase your chances of qualifying.
You should borrow private student loans if…
… you completed the FAFSA (Free Application for Federal Student Aid) process to check your eligibility for federal grants, work-study, and federal loans.
… you maximized the amount you are allowed to borrow from in both subsidized and unsubsidized federal student loans.
… your credit score or your cosigner’s credit score is good.
… you are only borrowing what is necessary.
… you compared many private lenders, and you are aware of the annual and cumulative loan limits, interest rates, fees, and loan terms of each firm.
Often, the interest rates, fees, and loan limits depend on the credit history of the borrower and co-signer and loan options chosen by the borrower. Factors such as in-school deferment and repayment schedules can affect interest rates, fees, and limits.
The fees lenders charge can significantly increase depending on the loan being taken out. A loan can have a relatively low-interest rate, but high fees can cost more compared to a loan with a high-interest rate and no fees.
The Top Private Loan Providers in 2020:
Sallie Mae: Does not disclose a minimum credit score.
College Ave: Accepts a minimum credit score in the mid-600s.
Ascent: Accepts a minimum credit score of 540.
Earnest: Accepts a minimum credit score of 650.
CommonBond: Accepts a minimum credit score of 660.
Discover: Does not disclose a minimum credit score.