Private (Alternative) Education Loans
Students who need additional funds beyond what they qualify for in federal student aid (including Federal Direct Loans) or students who are not eligible for Federal Direct Loans may wish to apply for a private (alternative) education loan. Note: A Free Application for Federal Student Aid (FAFSA) is not required to apply for a private (alternative) education loan.
What is a Private (Alternative) Education Loan?
A private (alternative) education loan is a non-federal education loan borrowed from a private lender, typically issued in the student's name and requiring a cosigner. The availability of these loans has been declining and most lenders who still provide these loans are increasing their interest rates.
Each lender has different eligibility requirements, interest rates, repayment terms and conditions. For example, some lenders require students to be enrolled at least half-time in a degree-granting program, while others will lend to students who are non-degree seeking (continuing education programs) or are enrolled less than half-time.
A private education loan cannot exceed a student's Cost of Attendance when added to all the student's other financial aid. We confirm this at the time we receive the private education loan certification request from the lender.
Private (Alternative) Education Loan Considerations
- Students enrolled in a degree program at the University of Georgia (UGA) should always complete the annual Application Process in order to be considered for Federal Direct Student Loans. Parents of dependent
undergraduate students should also request we award a Federal Direct Parent PLUS Loan
before considering a private (alternative) education loan. It is in the
student and parent's best interest to borrow the maximum amount of
Federal Direct Loans for which they qualify before borrowing a private
education loan. Here are some things to consider:
- Students do not have to start paying back their Federal Direct Stafford Loans until they graduate or stop attending school at least half-time. If you obtain a private loan, you will probably have to start making payments right away.
- The interest rate on a Federal Direct Stafford Loan is almost always lower than that on a private loan - and much lower than on a credit card!
- The government will pay the interest while in school at least half-time for students who qualify for a Federal Direct Subsidized Loan.
- Students do not need a credit record or a co-signer to get a Federal Direct Stafford Loan.
- Federal Direct Parent PLUS Loans require a credit check but the qualifying criteria is not as strict as for private loans and, if approved, the parent can choose not to begin repaying the loan until the student graduates or is no longer enrolled at least half-time.
- Students pursuing a degree program at another institution and enrolling in college credit courses through the University of Georgia Center for Continuing Education Independent and Distance Learning (IDL), should contact their school's financial aid office regarding their possible eligibility for financial aid (including federal student loans).
- Students enrolled solely in continuing education programs through the University of Georgia Center for Continuing Education are not eligible for federal Title IV student aid or the HOPE or Zell Miller Scholarship. The UGA Office of Student Financial Aid (OSFA) does not certify private education loans for students enrolled in continuing education programs. For guidance regarding their private loan certification process, continuing education program students should contact:
Georgia Center for Continuing Education
Kiel.Norris@georgiacenter.uga.edu (706) 542-3537
List of Private Education Lenders
Students and/or parents who find they must apply for a private education loan should contact their bank, credit union or other private lending institution to ascertain if they provide private (alternative) education loans. Students may also conduct an internet search for "private student loans". We strongly recommend you compare interest rates, loan fees and repayment plans before applying for any loan.
During the 2012-13 Award Year, students enrolled in UGA degree programs received private education loans from these lenders. The University does not endorse or recommend any private education (alternative) loan company. This is not a preferred lender list and is provided only a courtesy. The lenders are presented in random order. You are completely free to use a lender not on the list. The University of Georgia receives no benefits from any lender. See the University of Georgia Student Loan Code of Conduct for further information.
Lenders determine their interest rates, enrollment status and education program requirements, repayment options, and any fees that apply. Contact the lender directly for information on requirements, rates, and application procedures.
The Private Education Loan Applicant Self-Certification Form
The Truth In Lending Act (TILA) and the Higher Education Act of 1965, as amended (HEA), require a lender to obtain a self-certification signed by the private loan applicant before disbursing a private education loan. The lender may provide the applicant the self-certification form; however, you can also obtain the form by clicking on this link, Private Education Loan Applicant Self-Certification Form.
As a UGA student you can obtain the Cost of Attendance (COA) and Estimated Financial Assistance (EFA) information that you need to complete Section 2 of the form by contacting our office.